Ben-Gurion University of the Negev the Jacob Blaustein Institutes for Desert Research the Albert Katz International School for Desert Studies

Ben-Gurion University of the Negev The Jacob Blaustein Institutes for Desert Research The Albert Katz International School for Desert Studies

Can there be a Bi-National City under a Cold Peace? The Case Study of Eilat, Israel and Aqaba, Jordan.

Thesis submitted in partial fulfillment of the requirements for the degree of "Master of Science"

By: Jose Ramón Xilotl Soberón

Date: September, 2013

Ben-Gurion University of the Negev The Jacob Blaustein Institutes for Desert Research The Albert Katz International School for Desert Studies

Can there be a Bi-National City under a Cold Peace? The Case Study of Eilat, Israel and Aqaba, Jordan.

Thesis submitted in partial fulfillment of the requirements for the degree of "Master of Science"

By: Jose Ramón Xilotl Soberón

Under the Supervision of: Dr. Yodan Rofé

Department of: Environmental Studies

Author's Signature ………………………………………………….. Date: Sept. 8th, 2013

Approved by the Supervisor…………….……… Date …October 14, 2013

Approved by the Director of the School ……………………… Date ………….… 3

Abstract

Can there be a Bi-National City under a Cold Peace? The Case Study of Eilat, Israel and Aqaba, Jordan. Author: Jose Ramón Xilotl Soberón.

The thesis is in partial fulfillment for the degree of Master of Science, Ben-Gurion

University of the Negev, Jacob Blaustein Institute for Desert Research, Albert Katz

International School for Desert Studies, 2013.

Officially at peace since 1994, Israel and Jordan have since established multiple cooperation schemes with the aim of transitioning from a described Cold Peace to a self-sustaining Warm Peace. One that is particularly interesting from the point of view of Border and Urban Studies is the case of Eilat, Israel and Aqaba, Jordan. These tourist cities, located in the Arava Valley, are both physically isolated and strategically placed. Since 2001 they have been considered as a potential Bi-National City, and so far remain as the only one studied in a Cold Peace setting. Yet doubt persists whether a

Bi-National City may actually exist under such conditions. This thesis firmly establishes the place of Eilat-Aqaba as a Bi-National City by using a unique analysis of the region that updates and elaborates findings dating from 2001. The main contributions of the thesis include: 1) changes to the existing Border Integration Model that take into account the regional political complexity of the current Cold Peace, 2) modeling the Bi-National City Process of Eilat-Aqaba, and 3) identifying the limitations that the Cold Peace places on the current political situation in Eilat and

Aqaba. Secondary contributions include: 1) identification of multi-level actors affecting 4

Eilat-Aqaba and 2) identifying the important role played by international tourists within the Bi-National City Process of Eilat-Aqaba.

Acknowledgements

I would like to thank Ben Gurion University of the Negev for their material support in carrying out this work. I similarly want to thank the Jacob Blaustein Institute for Desert

Research and its staff for their great practical support during my studies. I want to also thank my supervisor Dr. Yodan Rofé for giving me the opportunity and guidance to work on such an interesting topic.

I extend my gratitude towards all those who granted me interviews and shared with me the living story of the Israel-Jordan border. I have kept private the names of those that preferred anonymity but do want to especially thank Mr. Samo Samorai for lending me copies of so many helpful documents. I want also to thank the members of the individual government ministries mentioned in the text that provided me with the necessary statistical information to carry out this work.

Table of Contents

Abstract……………………………………………………………………………… 3

Acknowledgements………………………………………………………………….. 5

Table of Contents……………………………………………………………………. 6

List of Tables …………….…………………………………………………………… 8

List of Figures………………………………………………...... 11

1. Introduction……………………………………………………………………. 13

2. Literature Review……………………………………………………………… 17

Border Studies Models for Bi-National Cities……...... 25

Bi-national Cities as extreme cases of Divided Cities………………………… 33

3. Methodology…………………………………………………………………… 38

4. Results (Research Objective 1)……………………………………………….. 57

Indicators A…………………………………………………………………… 57

Indicators B…………………………………………………………………… 79

Indicators C…………………………………………………………………… 85

Indicators D…………………………………………………………………... 99

5. Discussion (Research Objective 2)………………...... 111 7

Differences between the Results of the Gradus-Ehlers matrix and the Theoretical

Model……………………………………………………………………...... 112

Detailed Examples of the Economic Impact of the Differences between the Case

Study and the Theoretical Model… ……………………………………………… 115

A Detailed Example of the Economic Impact of the Differences between the

Case Study and Historical Theories of Border Studies………………………….. 118

The Impact of the Expanded Role of Local Government in the Case Study…….. 120

Modeling the Eilat-Aqaba Bi-National City………………………………………. 122

6. Conclusion…………………………………………………………………… 134

References………………………………………………………………….……… 139

List of Tables

1.1 - Timeline of Bi-National Events and Research on Eilat-Aqaba 1994-2009…...... 15

2.1 - Historical Border Studies Theories…………………………………………….....19

2.2 - Indicators showing Bi-National City Integration Processes for Eilat, Israel-Aqaba,

Jordan………………………………………………………………………………...... 37

3.1 – Gradus-Ehlers Matrix of Bi-National Integration Indicators for Eilat-Aqaba……40

4.1 – Bank of Israel Exchange Rate 21/01/13…………………………………………58

4.2 – Price Index 21/01/13……………………………………………………………59

4.3 – Price Index Comparison 21/01/13………………………………………………59

4.4 – Comparison of Israel-Jordan Bi-lateral Trade Statistics 2008-2011……………62

4.5 – DSJ Balance of Trade Israel-Jordan 1996-2011 (in USD Millions)……………65

4.6 – CBS Balance of Trade Israel-Jordan 1996-2011 (in USD Millions)……………67

4.7 – Total Truck Movements at Israel-Jordan Border Crossings 2006-2011…………72

4.8 – Projected Trade at Rabin/Arabah Border Crossing 2006-2011 according to DS

Jordan and CBS Israel (in USD)………………………………………………………74

4.9 – GDP Growth and Trade Growth between Israel and Jordan at the Rabin/Arabah

Border Crossing 2006-2011……………………………………………………………75 9

4.10 – Correlation between GDP Growth and Trade Growth between Israel and Jordan

(2006-2011)…………………………………………………………………………… 76

4.11- Bilateral Trade as % of GDP by Data Set (2006-2011)………………………77

4.12 – Points Awarded for Indicators Column 'A'……………………………………78

4.13 - Subcommittees of AECC by Number of Meetings 2011………………………80

4.14- Articles Co-authored by Israeli and Jordanian Researchers (1994-2013)………83

4.15 – Points Awarded for Indicators Column 'B'……………………………………84

4.16 – Difference in Departures (Wadi Arabah, Jordan) and Arrivals (Rabin, Israel) by

Data Set 2005-2011 (in Thousands)……………………………………………………86

4.17 –Relative Importance of the Eilat-Aqaba Crossing with relation to Total Crossings in Eilat & Aqaba 2005-2009……………………………………………………………89

4.18 – Land Crossing Arrivals at Rabin & Wadi Arabah as % of Total Land Crossings

Arrivals between Israel & Jordan 1996-2011…………………………………………90

4.19 – Average Cost of Double Room in Eilat and Aqaba 4/26/13-4/27/13 by Hotel Star

Rating (in NIS)…………………………………………………………………………91

4.20 – Points Awarded for Indicators Column 'C'……………………………………97

4.21 – Total International Arrivals (in Thousands) by Crossing in the Gulf of Aqaba

Region 2009……………………………………………………………………………98 10

4.22 – Population and Utilities in Eilat & Aqaba……………………………………103

4.23 – Housing and Utilities in Eilat & Aqaba………………………………………104

4.24 – Taxi Cost Rabin/Arabah to Central Bus Station 21/01/13……………………107

4.25 – Points Awarded for Indicators Column ‘D’…………………………………110

5.1 – Results of the Indicators showing Bi-National City Integration Processes for Eilat,

Israel-Aqaba, Jordan…………………………………………………………………112

List of Figures

2.1 – Israel-Jordan National Border……………………………………………………20

2.2 – Languages of the Middle East (Close Up)…………………………………….....22

2.3 – Religions of the Middle East (Close Up)…………………………………………22

2.4 – Topographic Map of the Israel-Jordan Border…………………………………23

2.5 - Continuum of Boundary Dynamics Model……………………………………….29

2.6 – Theory of Borderland Studies Model…………………………………………….30

2.7 – Actors/Context Matrix……………………………………………………………32

2.8 – Model of the Factors of Cross-Boundary Permeability………………………….33

4.1 – Imports and Exports Israel-Jordan (1996-2011) according to Israel and Jordan…63

4.2 – Total Trade Israel-Jordan (1996-2011) according to Israel and Jordan…………64

4.3 – Does Yearly Growth in Total Trade correlate with the Balance of Trade between

Israel and Jordan 1998-2011?...... 68

4.4 – Projected Relative Importance of the Balance of Trade between Israel-Jordan

(2005-2016)……………………………………………………………………………69

4.5 – Is there a Correlation between GDP Growth and Trade Growth between Israel and

Jordan (2006-2011)?...... 70 12

4.6 – Land Crossing Arrivals from Jordan to Israel 1996-2011………………………87

4.7 – Land Crossings from Israel to Jordan 2005-2011………………………………88

4.8 - Average Cost of Hotel Night by Hotel Rating in the Gulf of Aqaba Region…….92

4.9 – Land Use Map 2002……………………………………………………………100

4.10 – Land Use Map 2012…………………………………………………………101

5.1 – Borderlands in the Eilat-Aqaba Region…………………………………………124

5.2 – The Theory of Borderland Studies applied to Eilat-Aqaba……………………128

5.3 – The Eilat-Aqaba Bi-National City Process Model……………………………130

5.4 – Actor and Context Analysis for the Eilat-Aqaba Region………………………133

1. Introduction

The title of my thesis is, ‘Are Eilat, Israel and Aqaba, Jordan becoming a Bi-National

City? An analysis of urban processes across a Cold Peace border.’ A bi-national city is defined as: “…A double city on two sides of a state border…which are connected by feelings of closeness and togetherness.” They differ from twin-cities in that “…Local authorities [are] aware they have common – or conflicting – interests that involve them in deliberation and co-operation.”1 Yet as in the case of Tijuana, Mexico and San Diego, USA economic factors may even replace friendship between the twin-cities in driving bi-national city integration.2 Therefore, this thesis will focus on testing whether Eilat and Aqaba are increasingly coming together in objectively measurable ways as shown through government statistics, shared political will as expressed through joint plans or projects, and the experiences of politicians and other local actors in expanding their shared sphere of influence across the border.

My motivation for taking on this project stems from my own experience of working, prior to continuing my education, on the Mexico-Guatemala border; where I focused mainly on bilateral issues affecting the region. Faced with the wide-ranging issues and cooperation mechanisms employed across this border, that resulted from a deep political and cultural history, I wanted to explore an opposing case study in which local conditions for social and economic integration were limited by regional political concerns, and by ethnic, religious and linguistic divisions. This is categorically easier by focusing on one case study.

1 Ehlers, N. 2001. Binational cities and their regions: From diverging cases to a common research Agenda in GeoJournal. Vol. 54 P. 1-5. 2 Ehlers, N. 2001. Op cit. 14

My intentions in writing this thesis are multiple. I hope to show that the discipline of urban studies is a vital component for advancing theoretical debates about border cities. I hope to provide useful commentary on the liberal economic view of peace through commerce - commerce through peace which I sustain, is part of the ideological underpinning behind the Jordan-Israel Peace Treaty of 1994. Finally, by furthering ideas found in works by Professors Gradus, Ehlers, and Krakover regarding how to construct a methodology that measures warming relations between neighboring states using evidence found at the local level, I hope that this thesis will serve as a point of departure for future analysis of the Eilat-Aqaba bi-national city case study as well as other bi-national cities in cold peace situations.

The ‘mirror’ cities of Eilat (pop. 50,000) and Aqaba (pop. 100,000) are the outcome of a complicated recent history in which each served as a geopolitically strategic outpost on the Red Sea and near multiple international borders. Both are, for geographical and bioclimatic reasons, isolated from their countries’ population centers. Table 1.1 summarizes a brief historical overview of the study of the region as a cross-border city, since the signing of the peace accords between Jordan and Israel, and the establishment of an open border crossing between Aqaba and Eilat.

Table 1.1:

Timeline of Bi-National Events and Research on Eilat-Aqaba 1994-2009

Year Event 1994 Israel-Jordan Peace Treaty is signed 1997 1st Report to the Israeli Knesset on Joint Israel-Jordan-Egypt Regional Projects 2001 Gradus study states that Eilat-Aqaba is NOT a bi-national city 2004 Israel-Jordan Free Trade Agreement 2009 Krakover study finds evidence of a cross-border approximation between Eilat-Aqaba

Based on this recent history, this thesis is written with the following aims in mind:

1. To determine whether an ever closer union exists between Eilat, Israel and Aqaba,

Jordan since 2001.

2. To further the theoretical understandings of bi-national cities by exploring the case

study of Eilat-Aqaba.

3. To show how the disciplines of border studies and urban studies come together

within the theoretical framework of bi-national cities.

In order to achieve these aims I will analyze the theoretical framework of bi-national cities from the perspective of border studies and urban studies. This will serve to refine my aims to research objectives that may then be tested using a methodology tailored to the

Eilat-Aqaba case study. I will then analyze the results before concluding whether my hypothesis was right or wrong.

My hypothesis is:

As measured in several sectors and under several parameters interaction between Eilat,

Israel and Aqaba, Jordan exists and has increased since 2001. Although an Eilat-Aqaba bi- 16 national city (a theoretical framework that combines elements of border studies and urban studies) does not yet exist, the underlying process leading to the integration of said bi- national city does exist

This hypothesis is tested through the four sections of this thesis. The first section is the literature review which will consist of a short historical analysis of border studies that places the concept of bi-national cities within a larger discipline. This analysis will subsume elements of urban studies within it in order to differentiate between bi-national cities as a subset of border cities. Together, these same elements will produce an experimental matrix based on the bi-national cities literature. The second section of this thesis is the methodological section. This section will determine and justify the sixteen indicators that make up the experimental as well as establish how each indicator is to be awarded up to four points. Furthermore, the second section details how the results of the matrix are to be analyzed and compared to the bi-national city process. The third section, results, details the findings with regard to each indicator. This section makes heavy use of government data from Israel and Jordan, as well as interviews with local government officials and researchers from both cities. The fourth section, discussion, provides an in depth analysis of the results obtained in the previous section with additional information and examples that help develop the readers understanding of the specifics of the Eilat-

Aqaba case study. This analysis concludes by showing how the case study of Eilat-Aqaba requires that existing theories tied to bi-national cities be slightly modified in order to better fit the realities of the cold peace. The thesis concludes with a final statement that refers back through the whole work in order to suggest future research paths stemming from the issues raised herein. 17

The main elements that differentiate the Eilat-Aqaba case study from other more conventional bi-national cities from around the world have been the subject of a few studies since 2001. In particular issues relating to the separate cultures, languages, and political ideologies of Israel and Jordan have not had time to melt away in Eilat-Aqaba since the

1994 Jordan-Israel Peace Treaty. The underlying condition of cold peace between both countries and the regional political situation play-out as a very determining backdrop to the bi-national city integration process and yet, built-up political action and the heavy interests placed by both countries on the surrounding region are helping overcome the differences between both cities in particular in the fields of tourism and environmental management.

While the aim of the research is not to confront existing characterizations of the relationship between Israel and Jordan, the centrality of the concept of ‘cold peace’ requires a brief overview. According to Miller,3 four separate stages characterizing relations across conflict zones exist: hot war, cold war, cold peace, and warm peace. The transition to a cold peace is characterized by conflict reduction in the conflict zone. This transition is usually carried out under the auspices of a hegemonic power; a transition that suffers friction from regional and domestic forces limiting from transitioning further still to a warm peace (i.e. conflict resolution). This is arguably the case between Israel and Jordan4 where asymmetric media representations have had to be balanced with positive spin regarding the peace in both countries.5

3 Miller, B. 2001. The Global Sources of Regional Transitions frpm War to Peace in Journal of Peace Research. Vol. 38 no. 2 p. 199-225. 4 Shlaim, A. 2009. The Rise and Fall of the Oslo Peace Process in International Relations of the Middle East. Editor Louise Fawcett. Oxford University Press. p. 241-258. 5 Wolfsfeld, G et als. 2008. News Media and Peace Building in Asymmetrical Conflicts: The flow of news between Jordan and Israel in Political Studies, Volume 56, Issue 2, pages 374–398. 18

2. Literature Review

As a theoretical construct, bi-national cities exist within the realms of border studies on one hand, and urban studies on the other.6 This necessitates exploring pertinent literature related to these two fields. Specifically this review will address how the Eilat-Aqaba case study fits the main components comprising the history of border studies. It will explore pertinent current border studies theories that lend themselves to articulating a process for the integration of a bi-national city, and analyze the existing literature on Eilat-Aqaba as a bi-national city. It will conclude with the postulation of the thesis research objectives which tie into the methodology.

With increasing economic and cultural globalization, researchers have predicted the inevitable end of national borders due to economic pressure from above and cultural pressure from below. These calls have led to a recent explosion in borderland research that has updated the timeline of discussion on the matter to include Post-Modernist thought. 7

Summarized through the following historical writings, the case study of Eilat-Aqaba, as described in the introduction, may be understood through each one of the following lenses

(Table 2.1):

6 Ehlers, N. et al. 2001. Binational Cities and their Regions: From Diverging Cases to a Common Research Ageda in GeoJournal 54. Kluwer Academic Publishers. 7 Linares de Gómez, R. 2001. Fronteras: una visión teórica en el periodo contemporáneo in Aldea Mundo vol. 4 no. 7 p. 14-19. 19

Table 2.1:

Historical Border Studies Theories Event/ Writer Year Main Argument Treaty of Recognizes the Nation-State as the organizing unit of 1648 Westphalia the world’s land Describes the State as an organism with the border Ratzel 1896 being an appendage of the center Defines Good Borders (separating cultures along Hartshorne 1936 natural defensible barriers) and Bad Borders (those that do the opposite) Borders are re-categorized as being in Peace or Cold War Post 1945 Conflict, either open or in dispute, through criteria of cross-border functionality and interaction

Critiques of previous understandings: 1) seeing the border as a unique site of state ceremonialism where an individual is vetted for admission into a nation and Post 2) denoting the space of actual interaction among 1970s Modernism border groups as Borderlands which compromise a fuzzy set of unofficial borders based around levels of integration of various processes unique to the border region

The way in which these theories pertain to Eilat-Aqaba may be understood as such:

1) In terms of the role of the nation-state, the recognition afforded by the other country is defined by the Jordan-Israel Peace Treaty which demarcates the territorial division between these self-organizing units. Final political responsibility for any and all actions undertaken in either Aqaba or Eilat corresponds to their own country’s government. The international border exists as an absolute territorial and political limit, which in the case of a bi-national city demands the understanding of the city as made up of constituent parts separated by the international border. This can be best understood through figure 2.1 (below) which expresses Israel and Jordan in absolute and discrete terms. 20

Figure 2.1: National borders in the area of Eilat-Aqaba (Source: Rand McNally World

Atlas 2010)

2) In terms of the organization of the state, the extension of the State is carried out through local governments unique to the region. While Eilat is incorporated as a city council with a locally elected mayor whose authority ultimately does not rest in the national government,

Aqaba is governed through the Aqaba Special Economic Zone Authority (ASEZA) which is a development corporation whose head is appointed by the king, and which responds directly to the Hashemite Kingdom’s Office of the Prime Minister. Furthermore State appendages unique to border cities responsible for security affairs such as immigration and customs exist where Eilat and Aqaba meet. A common feature of border cities, Israel’s border services’ correspond to various State ministries for which the nation’s Prime

Minister is ultimately responsible wholly excluding Eilat’s municipality from managing these affairs. In contrast, Jordan grants a special immigration and customs regime to the 21

Aqaba Governate. Responsibilities for border services in Aqaba are thus the purview of the national government through ASEZA. In this sense ASEZA has a presence at the Israel-

Jordan border that the Municipality of Eilat simply cannot achieve; while the Municipality of Eilat has a greater political autonomy than ASEZA. This ensures that communications between local actors on certain issues must intersect with national actors on either side given the different capacities of local governments.

3) In terms of natural barriers serving as borders to linguistic groups, the self-definition of

Israel as A Jewish State in Eretz Israel8 and the Hashemite Kingdom as a royal dynasty descended from Hashim ibn Abd al-Manaf (died c. 510 CE), who is the great-grandfather of the Islamic prophet Muhammed, allows for each country to correspond to a highly differentiated linguistic group. While a sizable Arabic speaking population does reside within Israel, the map in figure 2.2 (below) shows that Jordan is a wholly Arabic speaking

(yellow color) country. The linguistic barriers (Hebrew in fuchsia color) in and around Eilat correspond to the national boundaries of Israel. Figure 2.2 also uses color gradation in order to symbolize population density thus showing how isolated Eilat-Aqaba is from the surrounding zones of Arabic and Hebrew speakers. Figure 2.3 (below) similarly shows that religious groups (Sunni Islam in green and Judaism in orange) firmly correspond to either side of the international boundary at Eilat and Aqaba.

8 See Declaration of Establishment of State of Israel on http://www.mfa.gov.il/mfa/foreignpolicy/peace/guide/pages/declaration%20of%20establishment%20of%2 0state%20of%20israel.aspx 28th of June 2013 22

Figure 2.2: Languages of the Middle East, close up (Source: Izady, M. 2006-09)

Figure 2.3: Religions of the Middle East, close up (Source: Izady, M. 2006)

Yet as seen in Figure 2.4 (below), the Arava Valley, through which the international border runs, is not a naturally defensive border given the surrounding mountains on both the Israeli 23 and Jordanian side of the border. This differs from the northern section of the international boundary that follows natural features such as the Jordan River and a quick rising plateau.

The geopolitical importance of the Arava Valley for both countries is due to the surrounding desert highlands that separate Eilat-Aqaba from latitudinal connections through the Sinai on one side and the Great Syrian Desert on the other side thus providing both countries an outlet to the Red Sea.

Figure 2.4: Topographic Map of the Israel-Jordan Border (Source: Wikipedia 2013)

4) Both Israel and Jordan were founded after the Second World War. The categorization of the border has gone from being de-facto to mutually recognized in a short time. This legal transition has coincided with the redrawing of the disputed line of control through successive wars (e.g. 1967) and hostile cease fire (e.g. 1948-1967) that were finally 24 resolved by the 1994 Jordan Israel Peace Treaty. The resulting de-escalation of the war apparatus on the border has included such actions as landmine clearing in the Arava

Valley,9 the normalization of border crossings, and the establishment of permanent diplomatic missions. This new state of peace has been categorized by Jordanian,10

American,11 and Israeli media as a ‘cold peace’. 12 A peace that, while allowing for cross- border permeability, suffers from a reduced sensitivity to economic benefits as national political views become more stringent. It stands to be noted that the signers of the Jordan-

Israel Peace Treaty expressed at the time that both sought a warm peace in comparison to the example of the cold peace between Israel and Egypt.13

5) In terms of seeing the border as a site for unique ceremonies, the State’s ceremonial role on the border is equally expressed by both Israel and Jordan at the Rabin/Wadi Arabah border crossing. As service provisions are reciprocal, the main difference between both countries lies in processes and not in services. For example, Jordan posts unarmed uniformed soldiers that provide for an additional representation of the State in comparison to Israel that posts ununiformed armed (at all times) personnel at the border crossing.

Similarly the high number of females working on the Israeli side contrasts with the all-male crews encountered on the Jordanian side of the border. Yet the most noticeable difference between Israel’s and Jordan’s presence at the Rabin/Wadi Arabah crossing point, is the

9 Bannoura, S. 2012. Israel starts removing mines close to border with Jordan, to build settlements in International Middle East Media Center. Dec 14th, 2012. 10 None. 2009. Without two-state solution, there is no future, King tells Israeli public in The Jordan Times. October 11th 2009. 11 Kenyon, P. 2009. Israel’s cold peace with Egypt, Jordan grows chillier in National Public Radio. October 26th 2009. 12 Omer-Man, M. 2011. This week in history: Israel and Jordan are connected in The Jerusalem Post. August 12th 2011. 13 Haberman, C. 1994. The Jordan-Israel accord: the overview; Israel and Jordan sign a peace accord in The New York Times. October 26th, 1994. 25 method for locals to obtain an entrance visa. While the Hashemite Kingdom of Jordan grants temporary residence visas at the Wadi Arabah without requiring prior notice, Israel only grants tourist visas to Jordanians in its Embassy in Amman, thus placing another hurdle before Jordanian citizens entering Eilat. However, it must be stated that Rabin/Wadi

Arabah is the border point between Israel and Jordan that is easiest to cross given the relatively relaxed atmosphere that permeates it in comparison with the two other crossing points such as the Allenby/King Hussein Bridge border crossing point.14 This is in part by design as Rabin/Wadi Arabah lies on the Arava section of the Israel-Jordan border and not on the Jordan Valley section where Allenby complements the security apparatus of the

West Bank.15

Border Studies Models for Bi-National Cities

Borderlands are defined as ‘regions around or between political or cultural entities where geographic, political, demographic, cultural, and economic circumstances or processes may interact to create borders or frontiers’.16 This definition places the thesis within the tradition of the second postmodernist critique of historical border studies theories seen in

Table 2.1.17 Eilat and Aqaba fulfill the requirements for application of these theories, as they exist within identified and defined borderlands. At its most basic this can be seen through their simultaneous identification within the Jordan-Israel Peace Treaty.

14 Various. 2009. Jordan 7th Edition. Ed Lonely Planet Publications and confirmed through personal experience 15 Zitun, Y. 2012. Israel’s most unsecured border? In Ynet Magazine. August 24th, 2012. 16 Parker, B. 2006. Toward an Understanding of Borderland Processes in American Antiquity. Vol. 71 no. 1 p. 77-100. 17 Linares de Gómez, R. 2001. Fronteras: una visión teórica en el periodo contemporáneo in Aldea Mundo vol. 4 no. 7 p. 14-19. 26

For Linares de Gómez the shift to Post-Modernist thought reflects the seeming paradox that exists between globalization on one hand, and the continuing fragmentation of places and between people at the local level. New manifestations of culture and identity are blurring the hard borders of the nation-state resulting in a “Third Space”.18 As a result, the efforts of the nation-state have changed with regards to borders transforming them from traditional strongly defined borders with single-point border services to today’s “Smart

Borders”19: hierarchical and multi-point, whose purpose is to label, filter, and provide surveillance, rather than to block out or separate whole groups of people. This diversification in the purpose of the border for the nation-state includes also a zone of cultural exchange,20 which completely alters the way borders are classified. Now borders must be measured in terms of their ability to create spaces of coexistence/separation and inclusion/exclusion as a function of the economic interactions in the border region.21 As a way of furthering this agenda, multinational projects such as the EU and ASEAN have worked to ease border controls between member nations, in order to foster processes of integration and cooperation at the supranational level.

For urban planning, the delimitation of the local border region into a unique niche of public policy affected by tendencies and decisions at a local, national, and supranational scale provides another theoretical domain: the bi-national city. This concept, defined as

“…A double city on two sides of a state border…which are connected by feelings of

18 Soja, E. 1996. Thirdspace. Malden Blackwell. 19 Mata-Codesal, D. 2007. Where we can meet: From borderlands to contact-zones. N.P 20 Taylor P. 1994. The state as container: territoriality in the modern world-system in Progress in Human Geography. Vol 18.2 p. 151-162. 21 Mata-Codesal, D. op cited. 27 closeness and togetherness”,22 rests on the satisfaction of Ehlers’ four tests: proximity, socioeconomic similarity, function, and competitive cooperation. While no specific metrics are suggested or have become standard for determining the existence of a bi-national city, geographers and social scientists have conducted descriptive case studies around the globe

(key regions being Mexico-USA, Ex-Soviet Bloc, and EU countries) in an effort to identify bi-national cities and model the workings of the international border in their creation.

Among the continuing case studies concerning bi-national cities lays Eilat-Aqaba.

Since independence these two cities have grown next to each other but without any formal interaction due to regional conflicts and tensions resulting in their parallel growth as

“Mirror Cities”.23 With the signing of the Jordan-Israel Peace Treaty in 1994, a new impetus at the national and international level resulted in the creation of long term regional projects covering Egypt-Israel-Jordan meant to take advantage of the economic possibilities of peace.24 By 2001, Gradus conducted an initial research into the Eilat-Aqaba region concluding that it was not yet a bi-national city, but finding potential for future integration being tied to four sectors: international commerce, tourism, infrastructure, and environmental management. Since then top-down political investments on both sides resulted in the 2004 Jordan-Israel Free Trade Agreement, and the 2001 reorganization of the Aqaba region into ASEZA which complemented the existing Eilat Duty Free Zone

(1985), thus providing greater economic incentives for the combined region. More recently,

22 Ehlers, N. et al. 2001. Binational Cities and their Regions: From Diverging Cases to a Common Research Ageda in GeoJournal 54. Kluwer Academic Publishers. 23 Gradus, Y. 2001. Is Eilat-Aqaba a Bi-National City? in GeoJournal 54. Kluwer Academic Publishers. 24 Kliot, N. 1997. The Grand design for peace: planning transborder cooperation in the Red Sea in Political Geography vol. 16 no. 7 p. 581-603. Elsevier. 28 conducting a new study on the potential of an Eilat-Aqaba bi-national city in 2012,25

Krakover found evidence to suggest that while a bi-national city still had not formed, more steps overcoming existing barriers were being taken. These efforts can be summarized as 1)

Construction of mega-projects on the border 2) Growing bi-national tourism 3) Local,

National, and International political will as expressed through regular meetings and mutually agreed upon agendas.

While Krakover states that several models for the creation of an integrated bi- national city/region exist, there has been no systematic comparison of the different models.

An additional critique is that the heavy dependence on description within the literature means that as of yet no quantitative indicators exist to identify a bi-national city. One solution is to use the bi-national city integration process as a backdrop to the data and use the subsequent analysis to highlight tendencies and model the bi-national city integration process itself. Krakover compares several models denoting their similarity in form. The first model he discusses is Parker’s (2006) “Continuum of Boundary Dynamics Model” which serves as an entry point in determining the Post Modern understanding of the

Borderland dynamic:

25 Krakover, S. 2011. Cross border interactions across a formerly hostile border: The case of Eilat, Israel and Aqaba, Jordan, Central European Regional policy and Human Geography, Vol. 1(2), pp. 51-64. 29

Figure 2.5: Continuum of Boundary Dynamics Model (Source: Parker, B. 2006)26

In Figure 2.5 the possibility of placing the different processes of each type of boundary along a continuum denoting it’s, leads to the understanding that border processes are variable and differentiated with regards to their policy implementation. Therefore, the shift along the continuum marked ‘Nature of Boundaries’ further requires an internal study of the mechanisms of each individual boundary type. Brunet-Jailly’s “Theory of Borderland

Studies” serves to break down the internal workings of each type of boundary into four separate self-reinforcing conditions (mainly at the local level).27 Over time the linear effects of each condition on another help to change the nature of the individual boundary type leading to a shift along Parker’s continuum from border to frontier. The possibility to alter the nature of the boundary is what defines the borderland region.

26 Parker, B. 2006. Toward an Understanding of Borderland Processes in American Antiquity. Vol. 71 no. 1 p. 77-100. 27 Brunet-Jailly, E. 2005. Theorizing Borders: An Interdisciplinary Perspective in Geopolitics vol. 10 p. 633- 649. Routledge. 30

Figure 2.6: Brunet-Jailly’s Model of the Theory of Borderland Studies (Source: Brunet-

Jailly, E. 2005)28

Each of the four conditions described by Brunet-Jailly has actors associated with it.

Yet given the self-reinforcing process that Brunet-Jailly’s theory espouses, actors are limited by the central assumption that the interests of all the actors are aligned. An initial criticism of this condition is that even if the interests of all actors are not aligned at all times, a borderland emerges due to dynamics set in motion through fragmentary action as further analysis of Eilat-Aqaba will prove. Additionally, the assumption of aligned interests is a key limitation to the theory given that intentions and motivations of the individual actors are likely to shape the process itself beyond the aligned interests they share.

28 Brunet-Jailly, E. 2005. Theorizing Borders: An Interdisciplinary Perspective in Geopolitics vol. 10 p. 633- 649. Routledge. 31

Knippschild provides evidence of this limitation by noting the preference of cross-border governments to set bi-national agendas focused on soft topics and not on all topics.29

Knippschild reasons that the need to remove sources of tensions within bi-national dealings is of central importance. This can lead to a lack of sharing information or talking about more difficult topics between different governments, levels of governments, and other stakeholders that can alter the approach of the actors to the issues and to the negotiations themselves. The complexity of the process requires a differentiation of the actors and their context (summarized as motives, resources, and tasks). For Knippschild actors don’t exist separate from their contexts resulting in their definition as actors/context. While Brunet-

Jailly assumes that the motives of the various actors/context to be aligned, Knippschild does not require for these actors/context to correspond to each other in anyway outside of the process being analyzed. The interplay of the actors/context as seen in Figure 2.7 allows for the principal actor/context otherwise known as the process designer/moderator to modify the process design.

29 Knippschild, R. 2005. Potentials of Cross-border Cooperation for Strategic Urban Development in Border Regions: Designing and Evaluating Informal Cooperation Processes in City Competition: Chances and risks of cooperation. ARL Working Group: Middle and East Europe. 32

Figure 2.7: Actors/Context Matrix (Source: Knippschild, R. 2005)

The integration of these three theorems into a single composite model is not treated by Krakover. Instead his work on the Egypt-Israel-Jordan region proposes an alternate model based on the Modernist principles of border policy.30 This alternate model is tailored specifically to Israel and its neighbors, focusing solely on the interaction of political stringencies and economic possibilities. It states that political and economic exigencies are two completely separate variables that when either reaches a certain value along an axis, will shift the value of the other thus setting the border policy that the two countries will take as seen in Figure 2.8 (below). While no specific values are given to these axes or a form for calculating or even defining the two variables is provided, Krakover provides

30 Krakover, S. 1997. A Boundary Permeability Model Applied to Israel, Egypt, and Gaza Strip Tri-Border Area in Geopolitics and International Boundaries, vol. 2 no. 3 p. 28-42. Frank Cass, London. 33 examples of the shifting policy as regards relations between Egypt and Israel throughout the late 20th Century.

Figure 2.8: Model of the Factors of Cross-Boundary Permeability (Source: Krakover 1997)

Bi-national Cities as extreme cases of Divided Cities

This theoretical overview of the underpinnings of borderland processes highlights a key deficiency in the literature, namely the lack of a model of bi-national cities that will allow us to compare and contrast the level of integration of several case studies along one single theoretical paradigm (the bi-national city). Having previously cited the corresponding literature specific to bi-national cities, I propose that the bi-national city may be understood as an extreme case of segregation within the existing urban planning discourse which will 34 allow us to use existing urban models dealing with divided cities31. In this sense the difference between an international border and internal political boundaries is understood as one of degree and not of kind. This allows for comparisons between ethnographic, religious, and language barriers common to the Middle East.32 As a result of these barriers divided cities tend to suffer from any of the following conditions: 1) the duplicity of institutions and resulting necessary coordination across political boundaries,33 2) polarized socioeconomic differences throughout functional city zones34, and 3) the need to overcome natural boundaries in order to create an integrated metropolitan area.35

In a historical context, the Polycentric36 and Hoyt Urban Models37 exemplify possible scenarios suited to understanding the Eilat-Aqaba case study by dividing the growing urban area along functional economic areas or by socioeconomic and ethnic areas.

While neither of these two urban models serves to highlight integration processes across strong boundaries, these may be complemented with the theory of urban agglomeration economics which states that as a city’s population rises, economic externalities will raise the overall GDP of the city beyond that expected by the simple addition of population, i.e.

GDP per capita will rise as a city’s population grows.38 Thus, two border cities may be said

31 Gaffkin, F. & Morrissey, M. 2011. Planning in Divided Cities. Blackwell Publishing.

32 Silver, H. 2010. Divided Cities in the Middle East in City and Community. Vol 9 no. 4. P. 345-357 33 Briffault, R. (1996). The local government boundary problem in metropolitan areas in Stanford Law Review ,vol. 48 no.5, p. 1115-1171 34 Mollenkopf and Castells, eds. 1991. Dual City: Restructuring New York. pp.225-244 35 Matthiessen, C. 2000. Bridging the Oresund: potential regional dynamics Integration of Copenhagen (Denmark) and Malmo Lund (Sweden) A cross-border project on the European metropolitan level in Journal of Transport Geography. Vol. 8 p. 171-180. 36 Harris, C and Ullman, E. 1945. The Nature of Cities in Annals of the American Academy of Political and Social Science. Vol. 242. P. 7-17. 37 Rodwin, L. 1950. The Theory of Residential Growth and Structure in Appraisal Journal, 18, p.295-317 38 Parr, J. 2002. Agglomeration economies: ambiguities and confusions in Environment and Planning A vol. 34 p. 717-731. 35 to form a bi-national city to the degree that the per capita economic value of population growth in both border cities is equal to that expected by cities of equal size to the total regional population in comparison to that expected by cities of equal size to the individual border city:

This idealized city form and its economic effects is of significance in explaining the effects of local growth (i.e. Eilat and Aqaba as two wholly separate cities and Eilat-Aqaba as a single bi-national city) given that de-agglomerative factors such as traffic congestion exist. Eilat-Aqaba’s regional spatial configuration as a polycentric city39 means that higher order investments such as airports and power plants are likely to have a greater economic effect on the city through higher labor productivity in comparison to concentric cities.40

Given the small size of Eilat and Aqaba individually, large investments limited to serving the population of either city individually may not prove cost effective. This means that failure to capitalize on bi-national cooperation focused on integrating a single market in the region, especially in infrastructure development limits the potential of higher order investments in the region. Similarly hindrances towards bi-national cooperation in international commerce (as a proxy for intra-city commerce), carries greater loss of economic potential in the bi-national city than in other border cities due to the greater economic effect of investment in a polycentric city in comparison to concentric cities.

Through the theory of urban agglomeration economics and divided cities are Ehlers’ four tests and Gradus’ economic sectors reproduced within urban studies theory. Gradus’

39 While a Polycentric spatial structure is usually the outcome of a process of unicentric metropolitan disintegration, Eilat-Aqaba’s structure is best understood as the integration of two unicentric settlements into a combined polycentric metropolis. 40 Meijers, E. & Burger, M. 2009. Urban Spatial Structure and Labor Productivity in U.S. Metropolitan Areas. N.P. 36 economic sectors are simply specific examples or a subset of the general economic conditions of the region that have been pre-selected by Gradus to better suit the case study.

Similarly, Ehlers’ four tests can be likened to those affecting divided cities in the Middle

East with the added complications of the cold peace between Israel and Jordan.

These two theoretical approaches: urban and border studies, approach the concept of the bi-national city. While urban studies likens the bi-national city to a polycentric divided city focusing on aspects of economic development and governance, border studies provides a historical background that places the bi-national city as a unique condition of different borders and political policies that imbue an area with additional significance. It requires a combination of both approaches to provide a satisfying understanding of the bi-national city. In this sense Ehlers’ previously mentioned tests for determining the bi-national city are particularly important for studying the Eilat-Aqaba case study. In the same way, Gradus’ work in determining which urban issues are best able to bring together Eilat and Aqaba are important in studying the border integration process between them. Taken together, Ehlers and Gradus provide a cross-referenced set of parameters for creating indicators to determine progress in the direction of the Eilat-Aqaba bi-national city. This is represented by Table 2.2 (below) in which Gradus’ economic sectors serve as the columns and Ehlers’ tests serve as rows with 16 cells where individual tests meet individual economic sectors: 37

Table 2.2: Indicators showing Bi-National City Integration Processes for Eilat-Aqaba

Indicators showing Bi-National City Integration Processes for Eilat, Israel-Aqaba, Jordan

A. B. C. D.

Gradus- International Environmental Tourism Infrastructure Ehlers Matrix Commerce Management

1. Proximity

2.Socioeconomic

Similarity

3. Function

4.Competitive

Cooperation

Evaluating the Gradus-Ehlers matrix is consequently vital to achieving research objective 1 which aims to show that in consistence with existing literature, Eilat-Aqaba has developed ‘ever closer relations’ within Gradus’ 4 key sectors, and therefore, Eilat-Aqaba is overcoming Ehlers’ four tests of bi-national cities. This will show that Eilat-Aqaba exist firmly within the realm of the bi-national city and not outside of it.

To evaluate the Gradus-Ehlers matrix will require creating, justifying, and scoring the 16 indicators defined by the matrix’s cells. The main justification for the use of the 38 selected indicators will be to extend the net of information used as far as possible to encompass the most diverse processes for which information may be found.41

3. Methodology

The general methodological approach to this research is deductive; given that the case study is being analyzed from the perspective of the border integration theory outlined above. It relies on an analysis of published and available data, augmented, by informant interviews where no data is available. Key data was acquired from public sources or self- gathered, and interviews were structured to fill-in gaps in knowledge resulting from the data analysis.

The first research objective states, “Show that in consistence with existing literature, Eilat-Aqaba have developed ‘ever closer relations’ within Gradus’ 4 key sectors and that they are is subsequently overcoming Ehlers’ four tests of bi-national cities. This will show that Eilat-Aqaba exist firmly within the realm of the bi-national city and not outside of it.” In order to place Eilat-Aqaba within the theoretical body of bi-national cities it is necessary to identify a cross-border cultural group that fits Brunet-Jailly’s theory.42

Although Gradus’ lists four groups with the possibility of overcoming the barriers to integrating Eilat-Aqaba into a bi-national city, he doesn’t provide an analysis of each of them. The research question is then posed: Eleven years after Gradus’ work, what group

41 An alternative would be to reduce the overall amount of information used and instead focus on fewer total data sets to provide for sixteen similar indicators. This possibility was cast aside in order to assure that as the indicators rely on approximation to determine the advance of bi-national processes, a more accurate picture is conveyed by the use of more varied datasets 42 Brunet-Jailly, E. 2005. Theorizing Borders: An Interdisciplinary Perspective in Geopolitics vol. 10 p. 633- 649. Routledge. 39 serves as Eilat-Aqaba’s local cross-border cultural group? This can be answered through the results of the Gradus-Ehlers matrix as the economic sector most successful in overcoming Ehlers’ four tests would appear to serve as the cross-border cultural group. The indicators to be used are shown in Table 3.1 (below).

An initial hypothesis for Research Question 1 is that tourists serve as Eilat-Aqaba’s local cross-border cultural group and it is tourists which are promoting the development of a bi-national city above efforts of other groups studied. This hypothesis may be substantiated by indicators under column C having higher results than all other columns.

This hypothesis of Research Question 1 is thus contingent on results from proof provided by testing the initial hypothesis of the methodology established above. Results for the sixteen indicators, as outlined for each one, will be determined by interviews with local and regional political and economic actors, by statistical analysis, and through counting analysis.

Table 3.1: Gradus-Ehlers Matrix of Bi-National Integration Indicators for Eilat-Aqaba

Indicators showing Bi-National City Integration Processes for Eilat, Israel-Aqaba, Jordan A. B. Gradus-Ehlers International Environmental C. Tourism D. Infrastructure Matrix Commerce Management Existence of Land use pattern Relative Price Local Gov. # People Crossing 1. Proximity analysis of Eilat- Index Meetings and the Border Aqaba Agenda Setting Money Destined Price per 'Star' 2.Socioeconomic Utility Consumption Trade Balance to Environmental Rating of Hotel Similarity Standards Management Rooms

Shared Public Cross Border Border Hours and 3. Function Trade Growth Services Attractions Transport Schedule

Concentration Joint and 4. Competitive Relations between Presence of Shared of Bi-national Separate Cooperation Hotels Infrastructure Trade Research

All the indicators will be evaluated and awarded up to four points according to criteria unique to each indicator. The accumulation of points across columns (economic sectors) and rows (tests of integration) allow for comparisons of each in the matrix. It should be noted that while many of these indicators are unique to this study, the use of so many of them in combination allows for greater certainty in the overall results. In this regard, it is the combination of results more than the results of any individual indicator that are important to this work. Based on Gradus and Ehlers’ writings, the four tests on one hand, and four economic sectors on the other, provide criteria that I expect to favor cross- border integration in comparison to the strong nationalist and protectionist policies of the past. 41

Indicators in Column A focus principally on statistical analysis of trade data and local prices. As a group, these indicators will help identify a common market, the significance of bilateral trade, and the concentration of said trade in Eilat-Aqaba. Indicators in Column B focus principally on interviews and document analysis dealing with political negotiations in Eilat-Aqaba. As a group, these indicators describe the relationship between

Eilat and Aqaba. Indicators in Column C principally make use of tourism marketing and statistical analysis of border crossing and hotel pricing data. Taken together, these indicators explore the local impact of international tourists in Eilat-Aqaba. Finally, indicators in Column D focus primarily on development plans of Eilat-Aqaba. As a group, these indicators describe the similarity and complementariness of local development between Eilat and Aqaba. For greater detail the following paragraphs describe the rationale and the methods of measurement for each individual indicator:

A-1) Relative Price Index:

Explanation:

In order to measure whether Eilat-Aqaba form a common market, a price comparison between four common products bought in comparable locations within each city will be made. Based on the idea of the Big Mac Index, this indicator takes into account the general costs behind the furnishing of the four products for determining price differentials between

Eilat and Aqaba. At the same time, a common market will provide pressure on establishments on both sides of the border to provide comparable pricing given the ease of acquiring the product within the common market. The indicator will consist of the following: 42

1) a McDonald’s Big Mac bought at a McDonald’s restaurant

2) a 500ml Coca-Cola bought at a neighborhood store

3) a 30g bag of Frito-Lays potato chips bought at a neighborhood store

4) a Nestle 1.5lt bottle of water bought at a neighborhood store.

Although this comparison will be a one-day spot comparison, the research method is justified firstly by the international pricing mechanisms behind the products selected which makes short-term price fluctuations unlikely and secondly because there is no reason to believe that the relationship between prices for these products in Eilat and Aqaba is likely to change within the time period this thesis is being written.

Points Awarded: For each of these products a point will be scored for cases in which prices were within +/-5% of each other (using the official exchange rate as determined by the

Bank of Israel on the day data is gathered).

Source of Information: Data for this indicator will be self-gathered in the field.

A-2) Trade Balance:

Explanation:

Economic dependence, highlighted through a lopsided trade balance, is often perceived as a danger to economic sovereignty. The indicator will measure the overall behavior of the trade balance between Eilat and Aqaba since 2001; data for Eilat and Aqaba will be taken from the value of goods moving through the Rabin/Arabah Border Crossing. In terms of measuring socioeconomic similarity, this indicator is justified in its effectiveness at dispelling representations of the trade relation between both countries as one sided or as 43 having a negative impact on the economic sovereignty of the other. By taking into account the local trade balance characterizations of the trade relationship between both cities can be made. This is important due to the impact of trade accounts on media and general man-on- the-street perceptions as well as the local impact of allied businesses sprouting up near the

Arabah/Rabin Border Crossing. Tolerance for the effects of special trade zones and treaties including the USA as a third party may additionally be made.

Points Awarded: Two points will awarded for a general trend towards an even balance of trade. Two additional points will be awarded for current trends reaching an even balance of trade within five years. Points in each category are equally divided among the two sets of national accounts. As each country keeps wholly separate accounts on imports/exports and these may vary wildly when compared, the validity of each data set won’t be disputed.

Instead data sets are presented as is and of equal worth for the purpose of this research.

Therefore points are equally awarded according to each set of national accounts.

Source of Information: The indicator will make use of data reported by the Central Bureau of Statistics, Israel and the Department of Statistics, Jordan.

A-3) Trade Growth:

Explanation:

One of the key commitments between Israel and Jordan is their Free Trade Agreement whose stated purpose is to induce trade growth as a component of peace. This indicator will measure the overall growth in the value of trade between Eilat-Aqaba since 2001. Data for

Eilat and Aqaba will be taken from the value of goods moving through the Rabin/Arabah

Border Crossing. This indicator is justified in measuring a stated goal of the Israel-Jordan 44 peace process which is increased economic activity between both nations. Similarly, the indicator is justified at the level of Eilat-Aqaba because of the impact the growth of allied business stemming from the movement of goods through the region. The comparison with growth in gross national product measures the effectiveness of international trade between both countries and cities in inducing GNP growth. In other words, local conditions for economic growth will be compared to national conditions for economic growth. Tolerance for the effects of special trade zones and treaties including the USA as a third party may additionally be made.

Points Awarded: Two points will be awarded for a generalized positive growth trend in total value of trade between each city and two additional points will be awarded if the positive growth trend is superior to national GDP growth. Points in each category are equally divided among the two sets of national accounts.

Source of Information: The indicator will make use of data reported by the Central Bureau of Statistics Israel and the Department of Statistics Jordan.

A-4) Concentration of Bi-National Trade:

Explanation:

Stemming from the comparisons made between Israel-Jordan and Eilat-Aqaba in the previous two indicators, this indicator will measure the role Eilat-Aqaba play in concentrating trade between both countries. The indicator is justified by its analysis of the long term effect of Eilat-Aqaba in cross-border trade. Far from major population centers, any concentrative effect evidenced in Eilat-Aqaba is likely due to comparative advantages detailed by Brunet-Jailly (2005). 45

Points Awarded: The indicator will measure to what degree has the total value of trade between Israel and Jordan concentrated at the Rabin/Arabah border crossing since 2001 granting one point for a general trend increasing the share of trade held crossing through

Rabin/Arabah in comparison to other Israel-Jordan border crossings. Additional points will be awarded for this border crossing concentrating 25%, 33%, and 50% of trade between

Israel and Jordan.

Source of Information: The indicator will make use of data from the Central Bureau of

Statistics Israel, the Israel Airport Authority, and the Department of Statistics Jordan.

B-1) Existence of Local Government Meetings and Agenda Setting:

Explanation:

The indicator will measure how often meetings between local governments with regards to environmental management take place, if this is in line with international agreements, and whether mutually signed declarations or agreements result from these meetings. The justification for this indicator lies in the intersection between Gradus’ view of environmental management as a source of integration between Eilat and Aqaba and the inclusion of environmental management as an issue to be discussed between both cities in the Israel-Jordan Peace Treaty.

Points Awarded: A point will be awarded for each local government meeting on the topic of environmental management held in the most recent year for which data is available with an additional point awarded in case high priority is given to meetings on this topic. 46

Source of Information: Sources used to determine this indicator will come from interviews with stakeholders in the governments of Eilat and Aqaba as well as analysis of the Israel-

Jordan Peace Treaty.

B-2) Money destined for Environmental Management:

Explanation:

The indicator will measure the amount of money being destined by Eilat and Aqaba towards environmental protection schemes within the Eilat-Aqaba region, including in the

Gulf of Aqaba in 2011. The indicator measures socio-economic similarity by focusing on two forms of legitimacy for investments in environmental management: equality in investments and consensus in investments. The indicator is justified by measuring aspects of each city’s ability to negotiate and meet expectations within environmental management.

Points Awarded: The indicator will award an initial point for the existence of a mutual agreement on the amount of money destined from either Eilat and Aqaba with a second point awarded if the amount of money destined towards environmental management is the same on both sides. A third and fourth point will be awarded if each city has delivered funds towards environmental management in accordance to mutual agreements.

Source of Information: The indicator will make use of information gathered from interviewing key stakeholders within the Eilat and Aqaba city governments.

B-3) Shared Public Services:

Explanation:

The indicator will identify integrated or shared public services that are either recognized or maintained through bi-national efforts in the Eilat-Aqaba region, including the Gulf of

Aqaba. The indicator will measure integration in terms of a full recognition or maintenance of environmental services, waste management, integrated water systems, and integrated electrical systems; these may be expressed through planning commissions or international agreements as well as physical connections. The indicator is justified in terms of analyzing the function of bi-national efforts towards environmental management by measuring those services of mutual interest and shared responsibility between the two cities that may be granted through mutual collaboration. This follows from previous indicators in that it delimitates the physical space for intervention by bi-national efforts.

Points Awarded: A point will be awarded for the existence of each of these four services within the Eilat-Aqaba region either recognized or maintained through coordinated efforts at the bi-national level. This includes the Gulf of Aqaba.

Source of Information: Information for determining this indicator will come from interviews with stakeholders within the Eilat and Aqaba city governments, published reports, and Google Maps.

B-4) Joint and Separate Environmental Research:

Explanation:

The indicator will measure whether joint and/or separate research with regards to local environmental issues affecting the Eilat-Aqaba region, including the Gulf of Aqaba, is being carried out. The purpose of this indicator will be to determine the level of cooperation and interest in long-term environmental management issues in the Eilat-Aqaba region. The indicator is justified, building on previous indicators, in terms of determining competitive cooperation, by providing a comparison of the number of research projects and publications carried out individually and jointly by researchers in Israel and Jordan. The need for institutional interest and backing for these projects places additional emphasis and develops professional connections between researchers on both sides allowing for a long-term discourse in environmental management of the Eilat-Aqaba region. This makes sense within the framework of the Israel-Jordan Peace Treaty.

Points Awarded: A point each will be awarded for published research in environmental management in the Eilat-Aqaba region carried out by either Jordanian or Israeli researchers since 2001, a third point will be awarded for said research being translated from Arabic to

English/Hebrew or from Hebrew to English/Arabic (as it makes the research’s findings accessible to stakeholders on both sides), a final point will be awarded for joint research being carried out by researchers or institutes from Israel and Jordan.

Source of Information: Sources of data necessary for determining this indicator will come from interviews with stakeholders within the Eilat and Aqaba city governments, researchers 49 at the Rabin Institute and Ben Gurion University, and a search of sites including www/scirus/com.

C-1) Number of People crossing the Border:

Explanation:

The ideal level of cooperation is for positive growth levels of total border arrivals at the

Rabin/Arabah border crossing to outpace all other land crossings between Israel and

Jordan. A lack of communication or inaccessibility between Eilat and Aqaba highlighted through a lopsided balance of visitors is often perceived as a danger to regional integration.

The indicator will measure the overall behavior of total border arrivals at the Rabin/Arabah border crossing between Eilat and Aqaba since 2001 and between Israel and Jordan since

2001. A second test will measure the resiliency of flows during periods of regional instability since 2001 (e.g. 2004-5 and 2009) between both Israel-Jordan and Eilat-Aqaba.

By measuring resiliency in Aqaba-Eilat by share of total land crossing arrivals during conflict years in comparison to non-conflict years, the indicator will reflect the level of proximity between both cities as they come together into a bi-national region. This indicator is justified in its effectiveness at dispelling representations of land crossings between both countries as one sided or as having little lasting consequence. By taking into account the national and the local total of land crossing arrivals, a differentiated approach of the subject may be made with regards to local versus national value placed on cross- border interactions resulting from land crossing arrivals. This differentiation is important due to the differentiated impact expected at the Eilat-Aqaba level under study as a bi- national region and the national level. 50

Points Awarded: Points will be divided between Eilat-Aqaba and Jordan-Israel with a point awarded for a general positive growth trend in the total number of arrivals since 2001 on either side of the Rabin/Arabah border crossing (for Eilat-Aqaba) and total land crossing arrivals at all border crossings between Israel and Jordan. A third point will be awarded in the case of Israel-Jordan for maintaining total land crossing arrivals at all border crossings between them above 2001 levels (as no direct conflict between Jordan and Israel has occurred since 2001 it stands to reason that years of interaction by people between both countries built resiliency in cross-border relations that withstand regional conflicts better over time). The fourth point will be awarded in the case of Eilat-Aqaba for showing resiliency during periods of regional instability since 2001 (e.g. 2004-45 and 2009) above levels shown by Israel-Jordan.

Source of Information: The indicator will make use of data from the Central Bureau of

Statistics Israel, the Israeli Airport Authority, The Ministry of Antiquities and Tourism

Jordan, and the Department of Statistics Jordan.

C-2) Price per Star rating of Hotel Rooms:

Explanation:

The indicator will compare the price of rooms on offer in Eilat and Aqaba in accordance to their star rating. As the market for hotel rooms is already divided according to star ratings, one way to test for the incorporation of an Eilat-Aqaba single market is through price parity. The indicator is justified in measuring the socioeconomic similarity between Eilat and Aqaba by considering them as a single hotel market united through similar hotel standards and pricing schemes. This comparison is admittedly imperfect given that the 51

Eilat-Aqaba hotel market is divided politically e.g. the large number of Saudi tourists in

Aqaba unable to enter Eilat or the different fees for exiting Israel and Jordan. Yet, price parity between similarly rated hotels in Eilat and Aqaba would show that political aspects are of less importance to hoteliers in Eilat-Aqaba than the financial benefits of treating the region as a single market.

Points Awarded: The indicator will award a point for price differentials of less than NIS

100 per night for hotel rooms rated at two, three, four, and five stars by local tourism boards in Eilat and Aqaba. Tolerance of NIS 142.10 (the combined Israeli and Jordanian exit fee at the Rabin Border Crossing) and NIS 73.45 (combined city center to city center cross-border transport costs) will be included as part of the general calculation of prices.

Source of Information: Sources of data for determining this indicator will come from tour operators and hoteliers in Eilat and Aqaba as well as sites such as www.tripadvisor.com.

C-3) Cross Border Attractions:

Explanation:

The indicator will measure the presence of cross border attractions mentioned in Fodor’s and Lonely Planet Guide Books (most recent editions) for Israel and Jordan based in the

Eilat-Aqaba region. The indicator is justified by the promotion of cross-border movement to tourists within the Eilat-Aqaba region leading to tourists planning trips accordingly. The indicator will thus measure the function of the Eilat-Aqaba region in terms of its acceptance by an international third party; similarly the identification of attractions on either side of the border represent unique regional attractions that serve to better the competitiveness of the whole Eilat-Aqaba region. 52

Points Awarded:

Two points will be divided between each guide book with a point awarded for the mention of at least one cross-border attraction in the Eilat-Aqaba region. Two additional points will be divided on the offer of cross-border day trips in Eilat and Aqaba by local tour operators from each city.

Source of Information:

Sources of data for compiling this indicator are the Jordan and Israel edition of travel guides published by Fodor and Lonely Planet and interviews with local hospitality groups.

C-4) Relations between Hotels:

Explanation:

Stemming from similarities in the economic make-up of both cities, hotels in Eilat-Aqaba have an important presence in the region anchoring the tourism trade in the region. This indicator will measure the relations between hoteliers on either side of the border in an effort to determine the competitive cooperation between them.

Points Awarded:

A point will be awarded if hotels recommend other hotels across the border with additional points awarded if hoteliers ever meet with their counterparts across the border, if they share marketing efforts with groups across the border, and if they ever present shared political initiatives on both sides of the border.

Source of Information:

Sources of data for this indicator are stakeholder interviews with tour operators, hotel groups, and local commerce boards.

D-1) Land use pattern analysis of Eilat-Aqaba:

Explanation:

The indicator will make use of aerial photos to measure the growth of the built environment according to land use in Eilat-Aqaba during 2002-2012. This indicator is justified in terms of deepening Krakover’s (2009) initial findings on the encroachment of development on land adjacent to the borderline as a result of the signing of the Israel-Jordan Peace Treaty.

As Krakover mentions that most of these new developments are tied to specific land uses; the indicator will measure whether proximity to the border is confined to only some land uses. . By encroaching upon the international border a greater physical compactness of the region’s built form may alter the understanding of each city into a greater form.

Points Awarded:

Points will be awarded for a physical shift in the location of each land use closer to the

Rabin/Arabah border crossing from either city. This will be measured through a comparison of the built form 2002-2012 and center on the principal land uses of transport infrastructure, residential, tourism, and industrial (including agricultural).

Source of Information:

Sources of data for this determining this indicator include Google Maps and on site analysis to determine major land use patterns. 54

D-2) Utility Consumption Standards:

Explanation:

The indicator will measure socioeconomic similarity by comparing average water and electricity consumption in Eilat and Aqaba. Following from Ehlers’ (2001) discussion that cities with large socioeconomic differences between them have greater difficulties in conforming a bi-national region; this indicator will allow for a comparison of key material living conditions in both cities.

Points Awarded:

Points will be awarded for a less than 20% difference in living standards as measured in

Eilat and Aqaba in terms of per capita and per dwelling utility consumption. Specifically, a point will be awarded based on near parity according to: liters of water per person per day, liters of water per dwelling per day, watts per dwelling per day, and watts per person per day.

Source of Information:

Sources of data for determining this indicator include the Central Bureau of Statistics Israel and the Department of Statistics Jordan.

D-3) Border Hours and Transport Schedule:

Explanation:

The indicator will measure whether the hours of operation of the Rabin and Arabah border crossing stations as well as public transport to and from the border crossing stations match 55 each other. In order for people and business to make effective and efficient use of border installations the dual sides must work simultaneously and with installations that are accessible to users on both sides. The indicator will measure function of the Rabin and

Arabah border crossing stations through the complementariness of their operation as it pertains to: operating times (hours per day and days per year) and public transport (mode of transport and cost).

Points Awarded:

Two points will be awarded for an exact match between the hours and days of operations of both border stations. An additional point will be awarded for a match in the total number and type of modes of transport available to and from the border crossing station with the final point awarded for cost similarity (+/-10% of total cost) from the border station to each city center.

Source of Information:

Data for this indicator will come from printed material given at the border by the Israel

Airport Authority and Customs Jordan and interviews with local stakeholders in the transportation industry.

D-4) Presence of Shared Infrastructure:

Explanation:

The indicator will measure the quantity of shared infrastructure projects or those under construction between Israel and Jordan present in the Eilat-Aqaba region. Given the seeming inefficiency of mirroring infrastructure developments in Eilat and Aqaba (e.g. 56 seaports and airports), a combined Eilat-Aqaba holds the potential for reducing infrastructure costs by consolidating infrastructure development that may serve the whole region. The indicator is therefore justified in measuring socioeconomic similarity through the sharing of development costs and benefits of use of shared infrastructure in the Eilat-

Aqaba region.

Points Awarded:

A point will be awarded for every major infrastructure project, up to four, built and operated in conjunction by Israel and Jordan within the Eilat-Aqaba region.

Source of Information:

Sources of data for determining this indicator are interviews with stakeholders within the

Eilat and Aqaba city governments.

Once all indicators are scored and the Gradus-Ehlers matrix is filled, research objective 1 will be met by comparing the results to 1993 and 2001. Scores will be displayed using Parker’s Continuum of Boundary Dynamics Model (Figure 2.5).

Research objective 2 reads, “Show that prevailing models and definitions fail to account for the more complicated story of the development of ‘ever closer relations’ between Eilat-Aqaba since the signing of the Peace Treaty.” Following from the results of the first research objective, the second research objective focuses on determining the case study’s place within the theoretical framework of bi-national cities. The second research objective will therefore show that prevailing models and definitions fail to account for the 57 more complicated story of the development of ‘ever closer relations’ between Eilat-Aqaba since the signing of the Peace Treaty. Assuming the results of the first research objective indicate that Eilat-Aqaba are by degree lying within the theoretical framework of a bi- national city, the second research objective will provide a mechanism for exploring why

Eilat-Aqaba’s history doesn’t fit that described by the border studies framework explained previously. The results of the second research objective will serve to illuminate suggestions for revising or confirming the theoretical framework behind this literature review.

The research question posed by research objective two is: How has the border integration process in Eilat-Aqaba developed along with regional political realities? The methodological approach for answering the second research question will be an analysis of all gathered information including interviews with local politicians, geographic analysis, statistical analysis, and bilateral agreements between Israel and Jordan since the signing of the 1994 peace treaty. These results will reflect on existing theories surrounding bi-national cities as explained in the previous chapter.

4. Results

The field research was conducted in Eilat and Aqaba between January and August 2013.

Additional interviews were gathered in Be’er Sheba, Israel and via phone. Field research mainly consisted of making use of the different services and acquiring the different products listed in the results of each indicator. Individual indicators are presented using the following structure: An initial paragraph(s) detailing the justification of the material gathered and the discussion of said material is followed by a second heading labeled points awarded. Points are awarded based on the criteria written for each indicator in the previous chapter. 58

Indicator A-1: Comparative Price Index

Justification and Discussion:

In order to determine a price comparison items were purchased in both Eilat and

Aqaba on January 21st 2013 per the appointed methods. The items were acquired in small shops in residential neighborhoods just beyond the central and tourist areas of each city.

The exchange rates used throughout the calculations are summarized as thus:

Table 4.1: Bank of Israel Exchange Rate 21/01/13

Currency Rate

NIS : JD 1 : .19

JD : USD .71 : 1

NIS : USD 3.74 : 1

Source: Bank of Israel 2013

Table 4.2: Price Index 21/01/13

Place Product NIS JD USD Cola = Coca-Cola in Non-refundable

packaging Big Mac 10.33 1.96 2.76

500ml Cola 1.84 0.35 0.49 Crisps = Doritos by Frito-Lay Aqaba 40g Crisps 2.10 0.40 0.56 Water = Nestle in Non-refundable 1.5lt Water 2.63 0.50 0.70 packaging Big Mac 13.90 2.63 3.72

500ml Cola 5.80 1.10 1.55 Eilat 40g Crisps 3.70 0.70 0.99

1.5lt Water 6.50 1.23 1.74

Table 4.3: Price Index Comparison 21/01/13

Price Price Dif. as % of Total Price Dif. as % of Product Dif. in Price in Aqaba Total Price in Eilat USD

Big Mac 0.96 35% 26%

500ml Cola 1.06 216% 68%

40g Crisps 0.43 77% 43%

1.5lt Water 1.04 149% 60%

* Aqaba has a 7% VAT (e.g. Aqaba Big Mac is JD

in Eilat

Tables 4.2 and 4.3 show that in all cases products purchased in Eilat proved more expensive (by absolute cost, if not by cost as percentage of average wage). This cost 60 differential negatively affects buyers in Eilat in comparison to Aqaba in gross terms. In net terms, the price differential affects those crossing from Aqaba to Eilat more negatively than it favors those crossing from Eilat to Aqaba. This price differential takes into account the

7% VAT (e.g. Aqaba Big Mac costs JD 1.83 before tax) imposed in Aqaba in comparison to Eilat’s 0% VAT. In other words, Eilat’s special tax status is not enough of a fiscal incentive to overcome the cumulative incentives for consumers found in Aqaba. To put into perspective the cumulative effect of the price differentials between Eilat and Aqaba one can take the example of a single product from those selected. For example Given the cost of crossing the border (NIS 100 exit tax paid to Israel and JD 10 paid to Jordan) of USD 40.81 it would take 39 500ml Coca-Cola’s to justify shopping in Aqaba over Eilat. This is quantity attractive to those able to purchase in medium bulk such as small shops or large families. Additionally It should be noted that in Aqaba there is a whole district dedicated to selling duty-free electronics which given the low cost barrier for residents of Eilat to shop in Aqaba can make economic sense as purchases above USD 583 make up the cost of crossing just by eliminating the 7% VAT. Consequently Aqaba proves competitive for shopping in comparison to Eilat.

In terms of developing a single market, there is no link at this level between product cost and price differential between both cities. Further evidence for this is seen in that packaging on either side of the border comes in different languages and product options diverge with Aqaba’s Chicken Big Mac being just one example. Extreme examples of market segmentation include different tasting Coca-Cola and different size crisp packages

(Eilat has predominantly 30g and 50g bag sizes While Aqaba has predominantly 20g and 61

40g bag sizes). Market segmentation thus seems to exist within the Eilat-Aqaba region separating both cities.

Points Awarded:

As price differentials exceed the allowed for maximum as seen in Table 4.3, no points are awarded. While same-product availability on either side of the border is indicative of the globalization of popular products which could be taken as proof of market integration, given the above arguments a single market cannot be said to exist in terms of consumables.

Indicator A-2: Balance of Trade

Justification and Discussion:

Comparing the trade balance between Israel and Jordan shows differences in the results obtained via the methodology used by each nation for calculating imports and exports. The following table shows a brief comparison between the trade balance as calculated by the Central Bureau of Statistics, Israel and the Department of Statistics,

Jordan for the years 2008-2011. The table is indicative of the need to first compare both set of trade statistics in order to understand the overriding narrative they present. Due to these discrepancies, trade indicators will have to be evaluated by both sets of trade statistics in order to award full points 62

Table 4.4: Comparison of Israel-Jordan Bi-lateral Trade Statistics 2008-2011

Source: Central Bureau of Statistics Israel & Department of Statistics Jordan 2013 Data in

USD Millions

In terms of narrative, the following graphs compare historical trends (1996-2011) of activity between both countries. By focusing on Imports and Exports, the first graph signals that the Jordanian trade statistics story is that conditions leading to an increase in exports in one country provoke the same action in the other country. This leads to a win-win situation where it is in both nations’ interest to increase total trade between them per liberal economic models discussed in the literature review. 63

Figure: 4.1: Imports and Exports Israel-Jordan (1996-2011) according to Israel and Jordan

$180.0

$160.0 R² = 0.5861 $140.0

$120.0

$100.0 R² = 0.7247 CBS Israel $80.0 DS Jordan $60.0 Linear (CBS Israel) $40.0 Linear (DS Jordan) ToMillionsin Israel USD $20.0

$0.0 86.8 69.1 -$20.0 $9.0

$ $20.1 $25.3 $21.0 $38.9 $52.4 $

$116.2 $136.6 $250.7 $288.5 $231.3 $185.6 $210.0 $132.9

To Jordan in USD Millions

In comparison, Israeli trade statistics present a different narrative; in that a clear historical trend exists where total trade increased between both countries. While historical events in 2005-6 (2nd Lebanon War) and 2009-10 (Arab Spring and Israeli intervention in

Gaza) led to a drop in trade (as expected under the idea that conditions for bi-national talks weren’t ideal given the regional situation), it strongly rebounded as soon as the regional crisis blew over. This is reflected in Figure 4.2 (below).

While neither set of statistics disagrees with the other’s narration of events, they fail to go beyond generally agreeing with each other. Yet forming two-sides of the same coin, the vision that peace is a pre-condition for trade and trade is the reward for peace; the dual narrative presented by the trade statistics alludes at a condition where greater trade is a sign of greater peace. Consequently, since 1996, the business of peace, according to each country has been good as even if each country presents differing accounts, each counts in a 64 way that shows it is gaining an advantage from trade relations i.e. more exports than imports. For both sets of statistics, the gap between exports and imports closes and inverts itself in 2010 even as trade increases at a rate of about USD 7 million a year.

Figure 4.2: Total Trade Israel-Jordan (1996-2011) according to Israel and Jordan

$450.0

$400.0 R² = 0.8925

$350.0

$300.0 CBS Israel $250.0 DS Jordan $200.0 Linear (CBS Israel) R² = 0.5462 $150.0 Linear (DS Jordan) Trade in USD Millions in Trade USD $100.0

$50.0

$0.0 1996 1998 2000 2002 2004 2006 2008 2010

Table 4.5: Balance of Trade Israel-Jordan 1996-2011 (in USD Millions)

Balance Total Value Yearly Growth Year To Jordan To Israel (Jordan) of Trade of Total Value

1996 $2.9 $7.1 $4.2 $10.0 -

1997 $13.7 $27.8 $14.1 $41.4 314.0%

1998 $22.7 $36.9 $14.2 $59.6 43.7%

1999 $29.0 $66.4 $37.4 $95.5 60.3%

2000 $70.6 $92.4 $21.8 $163.0 70.7%

2001 $110.8 $111.9 $1.1 $222.8 36.7%

2002 $125.7 $136.7 $10.9 $262.4 17.8%

2003 $133.7 $108.0 -$25.7 $241.7 -7.9%

2004 $164.7 $116.2 -$48.5 $280.9 16.2%

2005 $156.3 $118.2 -$38.1 $274.6 -2.3%

2006 $139.3 $132.5 -$6.8 $271.8 -1.0%

2007 $148.4 $154.5 $6.1 $302.9 11.5%

2008 $206.2 $167.2 -$39.0 $373.4 23.3%

2009 $130.5 $119.6 -$10.9 $250.1 -33.0%

2010 $89.0 $105.5 $16.5 $194.5 -22.2%

2011 $97.0 $113.5 $16.4 $210.5 8.2%

Source: Department of Statistics Jordan 2013

Table 4.5 uses Jordanian statistics to show that the balance of trade has fluctuated between favoring Israel and Jordan since 1996. Similarly growth in trade value has 66 remained high although varying from positive and negative growth rates. In comparison,

Israeli statistics, seen in Table 4.6 (below), indicate that the balance of trade has favored

Israel through 2011. Although both sets of statistics indicate that there was negative trade growth during five years throughout the period under review, Israeli statistics indicate that year-on-year growth of total trade was higher than that seen in the Jordanian statistics.

Table 4.6: Balance of Trade Israel-Jordan 1996-2011 (in USD Millions)

To To Balance Total Value Yearly Growth Year Jordan Israel (Jordan) of Trade of Total Value

1996 $9.0 $5.1 -$3.9 $14.1 -

1997 $20.1 $12.7 -$7.4 $32.8 132.6%

1998 $25.3 $17.2 -$8.1 $42.5 29.6%

1999 $21.0 $20.4 -$0.6 $41.4 -2.6%

2000 $38.9 $36.7 -$2.2 $75.6 82.6%

2001 $52.4 $42.0 -$10.4 $94.4 24.9%

2002 $69.1 $47.9 -$21.2 $117.0 23.9%

2003 $86.8 $44.4 -$42.4 $131.2 12.1%

2004 $132.9 $51.4 -$81.5 $184.3 40.5%

2005 $116.2 $60.9 -$55.3 $177.1 -3.9%

2006 $136.6 $38.2 -$98.4 $174.8 -1.3%

2007 $250.7 $54.4 -$196.3 $305.1 74.5%

2008 $288.5 $105.9 -$182.6 $394.4 29.3%

2009 $231.3 $70.0 -$161.3 $301.3 -23.6%

2010 $185.6 $94.1 -$91.5 $279.7 -7.2%

2011 $210.0 $172.9 -$37.1 $382.9 36.9%

Source: Central Bureau of Statistics Israel, 2013

Given this, it is necessary to analyze whether there is a correlation between growth in the total value of trade and the value of the balance of trade in order to determine if economic conditions between both countries inherently make a general trend towards a zero trade balance value impossible.

Figure 4.3: Does Yearly Growth in Total Trade correlate with the Balance of Trade between Israel and Jordan 1998-2011 (according to Israel and Jordan)?

50.0%

30.0% R² = 0.3411

10.0%

CBS Israel -40.0% -20.0% 0.0% 20.0% 40.0% 60.0% 80.0% -10.0% DS Jordan Linear (CBS Israel) R² = 0.0164 Linear (DS Jordan) -30.0%

-50.0% Balance of Trade as % of Total Trade Total of % as Trade of Balance

-70.0% Yearly Growth of Total Value of Trade

Figure 4.3 above shows that there is no strong correlation between growth in trade and the value of the balance of trade between Israel and Jordan in either set of statistics.

The trends in growth and balance of trade do not correlate with each other meaning that the evidenced sustained growth in both sets of statistics can allow for a USD 0 balance of trade. 69

Similarly, Israeli statistics indicating a sustained balance of trade in Israel’s favor do not indicate that this is a function of trade growth.

Figure 4.4: Relative Importance of the Balance of Trade between Israel and Jordan 1996-

2011 according to Israel and Jordan

70.0%

60.0%

50.0%

40.0% CBS Israel DS Jordan 30.0% Linear (CBS Israel) Linear (DS Jordan) 20.0% Balance of Trade as % of Total Trade Total of % as Trade of Balance

10.0%

0.0% 2011 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Figure 4.4 shows whether a general trend towards an even trade-balance exists between Israel and Jordan. The graph shows that according to Jordanian statistics this general trend since 1996 towards a USD 0 value does exist in part helped by 5 years with a trade balance equaling 5% or less of the worth of total trade. In comparison Israeli statistics show that while a period of a low trade balance disparity existed in 1999-2000 and 2011, a general trend towards trade parity does not exist. If the historic data is reduced to current 70 trends (since the 2004 signing of the Israel-Jordan Free Trade Agreement) then a further case can be made as to whether balanced trade may be achieved within five years given current trends.

Figure 4.5: Projected Relative Importance of the Balance of Trade between Israel-Jordan

2005-2016

70.0%

60.0%

50.0%

40.0% CBS Israel DS Jordan 30.0% Linear (CBS Israel) Linear (DS Jordan) 20.0% Balance of Trade as % of Total Trade Total of % as Trade of Balance 10.0%

0.0% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Using a roving 7-year average (Figure 4.5), the projected relative importance of the balance of trade between Israel and Jordan is not expected to dip below 5% of total trade by

2016. While Jordanian statistics project a trade balance of 6.8%-7.1%, Israeli statistics project 2011 as an anomaly with a projected trade balance worth 37.4% of total trade by

2016. It is important to note that this methodology does not take into account what side the trade balance will favor projecting instead the proportion of total trade that accounts for the zero-sum relation expressed in the trade balance. 71

Points Awarded:

One point out of two is awarded for the general trend towards a USD 0 value for the balance of trade evidenced in the Jordanian trade statistics. Zero points out of two are additionally awarded as a result of a projected trade balance worth above 5% of total trade by both sets of statistics between now and 2016.

Indicator A-3 & A-4: Trade Growth and Concentration of Bi-national Trade

Concentration of Bi-national Trade: The indicator measures to what degree the total value of trade between Israel and Jordan has concentrated at the Rabin/Arabah border crossing.

One point is granted for a general trend increasing the share of trade held crossing through

Rabin/Arabah in comparison to other Israel-Jordan border crossings. Additional points will be awarded for this border crossing concentrating 25%, 33%, and 50% of trade between

Israel and Jordan.

Results and Discussion: As data for trade value per border crossing is unavailable, this indicator relies on Israel Airport Authority truck movements at each border crossing in order to estimate trade activity. Due to the use of Door-to-Door and Back-to-Back procedures within the terminal, the stated number of truck movements is indicative of the total number of truck movements responsible for total trade and not just import or export.

Similarly it is important to note that due to existing agreements and the customs union between Israel and the Palestinian Authority, truck movement between the West Bank and

Jordan is concentrated solely at the Allenby border crossing. As the Allenby border crossing has operated at over capacity (60.55 truck movements a day in 2011 versus a 72 maximum capacity of 60 movements per day),43 it stands to reason that there is a demand by existing users to diversify and use other border crossings to Jordan as a way to save time and money.

Table 4.7: Total Truck Movements and their Relative Importance at Israel-Jordan Border

Crossings 2006-2011

Rabin Nehar Yarden Allenby Year Total Movements RI Movements RI Movements RI 2006 891 2.10% 31,471 74.00% 10,159 23.90% 42,521 2007 2,123 4.90% 29,605 68.60% 11,455 26.50% 43,183 2008 2,039 4.30% 32,161 67.20% 13,634 28.50% 47,834 2009 1,458 4.10% 20,952 59.10% 13,014 36.70% 35,424 2010 1,544 4.40% 18,890 54.30% 14,360 41.30% 34,794 2011 1,196 2.80% 19,426 45.50% 22,101 51.70% 42,723 Source: Israel Airport Authority 2013

Table 4.7 shows that total truck movements at the Rabin border crossing have seen a yearly fall since 2007. While a somewhat similar story is evident at Nehar Yarden,

Crossings at Allenby have been relatively stable throughout these years, and has seen a burst of activity during 2011. The Rabin/Arabah border crossing is the least used of the three crossings with its main attraction being access to the ports of Aqaba and Eilat in comparison to the major population centers and Mediterranean ports accessible through the other two crossings. In total, truck movements began to recover to previous levels during

2011 after a sharp 2-year drop.

43 Berman, E. 2008. Report on Palestinian Movement and Access: An integrated approach to Security and Commercial Movement. Embassy of Japan in Israel. 73

Expressed in terms of relative importance, total truck movements between Israel and Jordan have heavily concentrated away from Eilat-Aqaba (Table 4.7). This trend is further manifested by the declining share of truck movements at the Rabin/Arabah crossing.

Yet this reduction in truck movement does not necessarily imply a loss of trade activity at the Rabin/Arabah crossing. Table 4.8 (below) shows that, according to Israel trade statistics, the average value of each truck movement rose substantially between 2006 and

2008 setting an all-time high value in 2011. By this metric, shipping has become a more efficient business; yet due to the loss of truck movements, the overall value of trade at

Rabin/Arabah has diminished since 2008. On the other hand, Jordanian statistics bear out a drop in projected trade value at the Rabin/Arabah crossing of 60% since 2008 tied to a drop in the value per truck movement of nearly USD 3,000. In total it appears that while trade between Israel and Jordan was at its highest level in 2011 since 2008, trade activity and the share of trade conducted between Eilat and Aqaba has actually fallen over the last few years.

Table 4.8: Projected Trade at Rabin/Arabah Border Crossing 2006-2011 according to

Jordan and Israel (in USD)

Total Trade Trade Value per Projected Value of Trade

Data Set Year in USD Truck at Rabin/Arabah

Millions Movement Crossing

2006 $271.8 $6,391 $5,694,588

2007 $302.9 $7,015 $14,892,628

DS 2008 $373.4 $7,806 $15,917,357

Jordan 2009 $250.1 $7,060 $10,293,988

2010 $194.5 $5,591 $8,631,882

2011 $210.5 $4,927 $5,893,043

2006 174.8 $4,111 $3,662,821

2007 305.1 $7,065 $14,999,590

CBS 2008 394.4 $8,245 $16,811,925

Israel 2009 301.3 $8,506 $12,401,067

2010 279.7 $8,039 $12,411,818

2011 382.9 $8,962 $10,719,013

Source: Department of Statistics Jordan, Central Bureau of Statistics Israel &

Israel Airport Authority, 2013

Table 4.9: GDP Growth and Trade Growth between Israel and Jordan at the

Rabin/Arabah Border Crossing 2006-2011

Proj. Trade Growth at Total Israel-Jordan GDP Growth A/A Crossing Trade Growth Year DS CBS CBS Jordan Israel DS Jordan Jordan Israel Israel

2006 8% 6% - - -1% -1%

2007 8% 5% 162% 310% 11% 75%

2008 7% 4% 7% 12% 23% 29%

2009 5% 1% -35% -26% -33% -24%

2010 2% 5% -16% 0.1% -22% -7%

2011 3% 5% -32% -14% 8% 37%

Source: World Bank, 2013 & In text

Table 4.9 shows trade growth between Israel and Jordan, as a whole and localized in

Eilat-Aqaba, relative to both nations’ GDP growth. While the comparatively low base from which bilateral trade starts helps account for its wild year-to-year swings, Table 4.9 shows that While upswings in trade coincided with GDP growth (noticeably in the period 2006-

2008) downswings in trade were associated with lower average GDP growth (noticeably in the period 2009-2011). This is not meant to necessarily an implied causality as GDP growth and trade may both be determined by the welfare of the world’s economy. Table 4.10

(below) shows the weak correlation between bilateral trade growth and GDP growth using both sets of trade statistics. The lack of correlation implies that taken as a whole, the 76 economic impact of trade between both countries during this period is of little overall importance to national accounts. This is further evidenced by Table 4.11 (below) which shows that according to Jordanian statistics the relative importance of bilateral trade to both countries’ GDP has been falling since at least 2006. Although Israeli statistics coincide with this downward trend since 2007, it is interesting to see that according to these statistics bilateral trade is worth over 1.25% of Jordan’s entire Gross Domestic Product. This helps place the political significance of bilateral trade in terms of its actual economic effect.

Scaled to local levels, the economic impact of bilateral trade using the Rabin/Arabah border crossing is miniscule considering the political discourse endorsing relations between Eilat-

Aqaba found in successive bilateral treaties.

Table 4.10: Correlation between GDP Growth and Trade Growth between Israel and Jordan

(2006-2011)

Country Data Set R2 Value Jordan DS Jordan 0.1371 Jordan CBS Israel 0.2361 Israel DS Jordan 0.278 Israel CBS Israel 0.1887

Table 4.11: Bilateral Trade as % of GDP by Data Set (2006-2011)

DS Jordan CBS Israel Year Jordan Israel Jordan Israel

2006 1.80% 0.19% 1.16% 0.12%

2007 1.77% 0.18% 1.78% 0.18%

2008 1.70% 0.19% 1.80% 0.20%

2009 1.05% 0.13% 1.26% 0.15%

2010 0.74% 0.09% 1.06% 0.13%

2011 0.73% 0.09% 1.33% 0.16%

Source: World Bank, Central Bureau of Statistics Israel,

& Department of Statistics Jordan, 2013

Points Awarded:

Trade Growth: No points are awarded for a generalized positive growth trend in terms of total value of trade through the Rabin/Arabah border crossing. As successive metrics show, the total value of trade through the Rabin/Arabah border crossing has fallen since 2008.

There is little evidence to suggest a recuperation of prior trade levels based on the existing data. Yet seen as three year cycles, the passing effects of the Arab Spring may rebound trade levels in the near future (as evidenced in levels of total bilateral trade) but even so this trade concentrates outside of the Eilat-Aqaba region. In terms of points granted for the growth rate in localized trade above national GDP growth, no points are awarded. The metrics employed show that bilateral trade levels are having a very small effect on GDP 78 growth, that bilateral trade volumes are diminishing in their contribution to GDP since at least 2008, and that while trade levels at the Rabin/Arabah border crossing were superior to

GDP growth prior to 2009 the current trend is that of trade growth inferior to GDP growth.

Concentration of Bi-national Trade: Similarly, in terms of concentrating bi-national trade no points are granted. As indicated in the analysis above, the Rabin/Arabah border crossing has not increased its share of the total trade between Israel and Jordan beyond that evidenced by the greater value of each truck movement which itself is in dispute. As its projected share of trade has not surpassed 10% in the years for which data is available

(2006-2011, in comparison to the suggested 2001-2012) zero points are awarded.

Summary:

Table: 4.12: Points Awarded for Indicators Column 'A'

Indicator 1 2 3 4 Total

Points 0 1 0 0 1

The four indicators presented in this section show the limited nature of international commerce’s role as a driving force towards integrating Eilat/Aqaba as a bi-national city.

While an initial challenge to determining the size of bi-national trade lies within the vastly different data sets kept by Israel and Jordan, these data sets indicate that total trade fluctuates in accordance with regional conflicts. Similarly these data sets both indicate that

Eilat and Aqaba’s role in bi-national commerce is limited. The Wadi Arabah/Rabin border 79 crossing is primarily a human crossing point. While further analysis may include determining the percentage of local GDP that is compromised by bilateral trade, at the national scale bilateral trade makes up a noticeable amount of Jordan’s GDP. Political actions that reflect this include the signing of the Jordan-Israel Free Trade Agreement and the tripartite (with the USA) Qualified Industrial Zone agreement, both of which are meant to foster bi-national trade. As bi-national trade nears 20 years, the trade balance presented by both countries shows a move towards absolute parity. Yet, these commercial interactions have failed to create a single market for comestibles in Eilat-Aqaba. The price of products as well as their presentation continues to differ across national boundaries even as comparable tax benefits exist in Eilat and Aqaba. As international commerce fits closely with the secondary economic nature of both Eilat and Aqaba as logistical centers, it is interesting to compare the low score of this section as opposed to tourism. It stands to reason that less has been achieved towards integrating a bi-national city by those involved in international commerce precisely because it has a secondary economic role in the region.

B-1) Existence of Local Government Meetings and Agenda Setting:

Results and Discussion:

As a result of the peace process, the Aqaba-Eilat Coordination Committee (AECC) was established to coordinate the actions of the 8 subcommittees tied to the 1996

Agreement on Special Arrangements for Aqaba and Eilat between the Government of the

State of Israel and the Government of the Hashemite Kingdom of Jordan. As mentioned by 80

Eilat officials during interviews, these subcommittees were created based on lessons gleaned from dealings between Eilat and Taba during the 1980’s.

Table 4.13: Subcommittees of AECC by Number of Meetings, 2011

Committee Meetings Committee Meetings

Environment 3 Tourism 3

Water, Energy, and 2 Civil Emergency Response 2 Roads

Health 2 Mayors' Meetings 2

Culture, Sports, and Transportation 1 1 Education

Economic Development 1 International Fund Raising 1

Source: Krakover, S. 2011

Table 4.13 shows that of the eight subcommittees, Environment and Tourism show the highest level of activity for the most recent year for which data is available. Similarly, it is interesting to note that four subcommittees did not convene the minimum of twice yearly agreed upon at the AECC meeting of Dec. 10th 2006.44 Major issues pertaining to the

Environment subcommittee committee have included in the past joint research proposals, joint combating of oil pollution in the Gulf of Aqaba, and (in conjunction with the Health subcommittee) fighting to eradicate pests such as the Indian house crow and the

Mediterranean mosquito. Interviews with participants of AECC meetings reveal that While

44 AECC. 2006. Minutes of the Aqaba-Eilat Coordination Committee Meeting December 10th 2006. Eilat, Israel. 81 the official committee is integrated by a shared team of local (Eilat municipality and

ASEZA) and foreign office officials, delegation of responsibility results in most subcommittee meetings being assisted by the same participants regardless of the subcommittee that is convening. This emphasis on convenience and speed with regards to dealing with joint issues means that the number of meetings of each subcommittee is an indication of the importance placed on those issues by those involved and not just an account of the number of times that any single subcommittee can physically convene.

Points Awarded:

Three points are awarded for this indicator based on three meetings held by the

Environment subcommittee. An additional point is awarded based on the perceived high priority given to environmental affairs in comparison to other issues by Eilat and Aqaba.

B-2) Money destined for Environmental Management:

Results and Discussion:

Based on interviews carried out with employees of ASEZA, there is at present no mutual agreement between both cities and/or both countries guaranteeing an amount of money to be spent (either mutually or individually) on environmental management in the

Eilat-Aqaba region. ASEZA destines each year between USD 12-16 million (via multiple agencies and budgetary lines) to environmental management in Aqaba. Similar figures were unobtainable for Eilat. 82

Points Awarded:

Zero points are awarded for this indicator based on the lack of an agreement that covers spending on environmental management across Eilat-Aqaba. The lack of information regarding the cost of environmental management in Eilat prohibits making comparisons with Aqaba.

B-3) Shared Public Services:

Results and Discussion:

According to Eilat city officials, no joint public services are currently being given in conjunction with Aqaba. While exploratory talks have been held through AECC, no physical connections have been established by the public services on both sides that would allow for integrated services. At the level of planning, details on projects and master plans have been shared across the border between Eilat and Aqaba but as of yet, planning processes are not formally integrated. Emergency services including disaster relief, medical evacuations, and general civil emergency response appear the closest in achieving joint planning status. This is due to jointly commissioned studies and exchange of procedures that has already taken place.

Points Awarded:

In terms of shared public services, zero points are awarded seeing as of the four cases considered Eilat and Aqaba do not provide nor plan for shared service provision. This 83 is in part due to both cities being attached to their own local utility network that is not designed for sharing services in the Gulf of Aqaba region.

B-4) Joint and Separate Environmental Research:

Results and Discussion:

Separating the number of articles co-authored by Israeli and Jordanian researchers into three periods,45 the period 2001-2012 proves to be the most significant. According to Table

4.14, the number of articles specifically referring to Environmental Management grew less significantly during this period.

Table 4.14: Articles Co-Authored by Israeli and Jordanian Researchers (1994-2013)

Period Articles Coauthored Pre 1994- 2001- Total 1994 2001 2012 All Types 0 15 121 136 Environmental Management 0 4 12 16 Source: www.scirus.com on 16th of October 2013

Since 2001 common strains in the research include an emphasis of the Gulf of Aqaba as opposed to land conservation and English-language publication. Environmental research in the area tends to be carried out either by universities or through international grants including USAID and EuropeAid. In interviews with Israeli and Jordanian academics carried out at Ben Gurion University, both state that informal connections between researchers on both sides of the border exist. Similarly both state that these contacts lead to shared research but that due to ‘professional considerations’ researchers tend to publish separately. While this does not mean that joint research projects have not been formally

45 See http://www.scirus.com/srsapp/ 84 carried out and published or that programs meant to integrate young researchers from both sides of the border (e.g. the Arava Institute) do not exist, the results of these interviews are telling.

Points Awarded:

Three points are awarded for English-language research published by both Israeli and

Jordanian researchers on environmental management in the Gulf of Aqaba region since

2001.

Summary: Points Awarded for Indicators Column ‘B’

Table 4.15:

Indicator 1 2 3 4 Total

Points 4 0 0 3 7

In terms of environmental management much interest has been showed by both sides. Understood as relatively depoliticized, this topic has appealed to politicians and researchers from both countries as well as foreign donors wanting to further cooperation between both nations. This is in no small part on the special characteristics of the Gulf of

Aqaba including its world famous coral reefs that present the region with long term economic possibilities through sustainable tourism. Yet barriers remain as evidenced by the reticence in establishing formal networks between researchers on both sides of the border 85 as well as in sharing service provision between Eilat and Aqaba. Since 2001, relations between Eilat and Aqaba have improved to where information is shared between both cities and under relatively lax supervision by each country’s foreign office. Cooperation in the field of environmental management has spilled over to environmental education as evidenced by projects like the Arava Institute.

C-1: Number of People Crossing the Border

Results and Discussion:

Similarly to the different numbers of Israeli and Jordanian trade data sets explored previously, two vastly different counts for land crossings between Jordan-Israel exist. The differences between the Israeli and Jordanian data sets are summarized in Table 4.16

(below):

Table 4.16: Difference in Departures (Wadi Arabah, Jordan) and Arrivals (Rabin, Israel) by

Data Set, 2005-2011 (in Thousands)

Arrivals (CBS Departures (MTA Difference (Deps - Rel. Imp. Of the Israel & IAA Jordan) Arrivals) Difference Year Israel)

Wadi Arabah/ Jordan/ Arabah/ Jordan Jordan Rabin Israel Arabah Rabin Israel Rabin / Israel

2005 46.2 827.7 37.5 143.6 8.7 684.1 18.8% 82.7%

2006 40.9 830.6 36.1 136.9 4.8 693.7 11.7% 83.5%

2007 98.6 916.6 45.3 167.0 53.3 749.6 54.1% 81.8%

2008 146.9 1,070.4 85.0 272.3 61.9 798.1 42.1% 74.6%

2009 110.2 897.1 71.5 227.2 38.7 669.9 35.1% 74.7%

2010 124.3 851.4 133.0 370.2 -8.7 481.2 7.0% 56.5%

2011 134.8 1,107.5 99.5 307.8 35.3 799.7 26.2% 72.2%

Sources: Ministry of Tourism & Antiquities Jordan, Central Bureau of Statistics Israel, Israel

Airport Authority 2012-13

Table 4.16 shows that substantial differences of as much as 54% at Rabin/W.

Arabah and 83% Israel/Jordan exist since 2005. In almost all cases Jordan shows more people exiting towards Israel than Israel says arrives in Israel. One possibility is that hundreds of thousands of people manage to exit Jordan without being allowed to enter

Israel, while a second possibility is that these people are administratively lost in transit. One possible explanation has to do with how people crossing into the West Bank are accounted 87 for the fact that Rabin/W. Arabah also sees these distortions indicates that this is not a satisfactory answer. Due to these discrepancies, international crossings data will wholly make use of arrivals as presented in the data sets endorsed by the country of arrival. This makes sense as the economic and touristic potential of land crossings lies in the arrival of a person to a destination more so than in their departure.

Figure 4.6:

Figure 4.6 relates land crossing arrivals from Jordan to Israel and Wadi Arabah to

Rabin border crossing 1996-2011, using a 2-point polynomial line. In both cases a two- stage general trend exists with an initial stage 1996-2002/3 characterized by a relatively steady number of arrivals followed by a sharp drop in arrivals. A second stage of growth in arrivals conforms to 2003-2011 in which arrivals meet and surpass earlier peaks. One 88 additional feature of the graph is the dramatic year-on-year drops and spikes in arrivals found throughout the timeline such as 1998-1999, 2000-2001, 2003-2004, and 2007-2011.

This suggests that arrivals are highly volatile and easily influenced by additional factors for example the lasting effects of the 2nd Intifada. In comparison Figure 4.7 (below) a positive linear growth trend for arrivals data to Jordan and Wadi Arabah since 2005. While previous data is unavailable, the lack of major volatility after the 2008 peak is sharply different from that evidenced by arrivals to Israel. The period covered by the data can reasonably be related to events regarding Israel’s relation with Palestine:

1996-1998: 1st Netanyahu government and subsequent freeze in negotiations

1999-2000: Barak government restarts negotiations ending in September 2000

2001-2003: 2nd Intifada

2009 and 2011: Military operations in Gaza

Figure 4.7:

source: Ministry of Tourism & Antiquities Jordan, 2012 89

Figures 4.6 and 4.7, seen together, show that total arrivals in each country and arrivals at Rabin/Wadi Arabah rose since 2001 (or at least 2005). With regards to the volatility evidenced in Figure 1, as no direct conflict between Jordan and Israel has occurred since 2001 it stands to reason that years of interaction by people between both countries built resiliency in cross-border relations that withstand regional conflicts better over time. This resiliency is tested at the local level through the concentration of land crossings at Rabin/ Wadi Arabah over time. As local interaction and knowledge grows between Eilat and Aqaba, outside factors influencing land crossing arrivals in the area diminish as local conditions and interests mitigate others. Greater concentration of total arrivals at Rabin/Wadi Arabah thus suggests that peaceful interaction in the locality is increasing faster than in other border localities that are seeing their share of total land crossing arrivals diminish. Evidence of this exists in Table 4.17 (below) which shows a general trend towards concentrating land crossing arrivals at Rabin/Wadi Arabah since

2001 (at least 2005) with a peak in 2010. It is interesting to note the much larger concentration of land crossings over trade at this border.

Table 4.17: Land Crossing Arrivals at Arava & Wadi Arabah as % of Total Land Crossings Arrivals between Israel & Jordan 1996-2011 Year 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Arava/Israel 27% 20% 17% 26% 26% 26% 27% 31% 31% 36% 32%

Wadi x x x x 7% 6% 12% 17% 14% 16% 13% Arabah/Jordan source: Ministry of Tourism & Antiquities Jordan, Central Bureau of Statistics Israel, Israel Airport

Authority, 2012 90

Additional evidence for this argument is Table 4.18 (below) which shows that between 2005-2009 the number of arrivals at Rabin/Wadi Arabah increased as a proportion of all crossing arrivals in Eilat and Aqaba (Eilat and Aqaba have additional land/sea crossings to Egypt and Saudi Arabia).. While data after 2009 is of limited use given the regime change in Egypt and its effect on tourism, the current trend occupying the latest volatile years (as determined in Graph 8) is that of greater movement of people between

Eilat and Aqaba in comparison to the rest of the cities in the Gulf of Aqaba region.

Table 4.18: Relative Importance of the Eilat-Aqaba Crossing with relation to

Total Crossings in Eilat & Aqaba 2005-2009 Year Border Crossings 2005 2006 2007 2008 2009 Wadi Arabah/Aqaba 12% 10% 15% 21% 21%

Arava/Eilat 18% 17% 20% 27% 29%

Points Awarded:

In terms of points, two points are awarded given the general positive growth trend in the total number of arrivals since 2001 (or earliest available date) on either side of the

Rabin/Wadi Arabah border crossing as well as total land crossing arrivals between Israel-

Jordan. A third point is awarded as total land crossing arrivals between Israel-Jordan are above 2001 levels (or earliest available figures) While a fourth point is awarded as Eilat-

Aqaba show a greater level of resiliency in terms of total land crossings during periods of instability than Israel-Jordan as a whole.

C-2: Price per ‘Star’ rating of Hotel Rooms

Results and Discussion:

In order to determine whether a combined tourist market exists, hotel prices per star-rating in Aqaba and Eilat were compared. The assumption of a combined tourist market should lead to similar pricing on both sides of the border as cross-border competition for foreign and domestic tourists erodes the monopolistic advantages of each

Red Sea resort city. In theory, the elasticity of the price structure at each star-rating tier should be accounted for by the existing restraints on tourist movement (combined border exit fees of a NIS 142.10 and transport costs of NIS 73.45) whose importance, being a fixed cost, decreases as length of stay increases. Yet as evidenced by Table 4.19 (below), hotel prices per night across all star-ratings are considerably lower in Aqaba than Eilat.

Table 4.19: Average Cost of Double Room in Eilat and Aqaba (4/26/13-4/27/13) by Hotel

Star Rating (in NIS)

Star Avg. Room Avg. Room Border Exit Price Transport Savings % Rating Price Eilat Price Aqaba Fees Difference

5 ₪ 1,290 ₪ 810 ₪ 142 ₪ 73 ₪ 264 20.5%

4 ₪ 767 ₪ 476 ₪ 142 ₪ 73 ₪ 75 9.8%

3 ₪ 611 ₪ 274 ₪ 142 ₪ 73 ₪ 121 19.9%

2 ₪ 484 ₪ 213 ₪ 142 ₪ 73 ₪ 55 11.4%

1 ₪ 472 ₪ 128 ₪ 142 ₪ 73 ₪ 128 27.2%

Source: www.hotel.com 4/21/13, previous tables

Based on a sample of 52 hotels with internet booking systems rated by www.hotel.com in Eilat and Aqaba, average room-night cost differences only dip below

NIS 100 when taking into account transport and border exit fees in any tier. This limits the attractiveness of Eilat to foreign tourists that can fly into Aqaba avoiding these added costs as well as to Israel- based tourists that can still save per hotel night by avoiding Eilat. This is especially the case of 3 and 5 star hotels which present a 20% savings. It is interesting to note that simply eliminating the cost of transport and border exit fees results in 1 and 2 star

Eilat hotels competing on price with 4-star hotels in Aqaba. Yet outside the bounds of the present indicator, Figure 4.8 (below) shows the price sensitive nature of the region’s hotels.

Figure 4.8: Average Cost of Hotel Night by Hotel Rating in the Gulf Region (in NIS)

₪ 1,300.00

₪ 1,100.00

₪ 900.00 Eilat Aqaba ₪ 700.00 R² = 0.8078 Taba Aqaba-Eilat-Taba Price per Night perPrice Linear (Eilat) ₪ 500.00 Linear (Aqaba) Linear (Aqaba-Eilat-Taba) ₪ 300.00

R² = 0.9321 R² = 0.8928 ₪ 100.00 5 4 3 2 1 Hotel Rating

As seen in Figure 4.8, a linear regression trend shows a significant correlation in both Aqaba and Eilat between price per night and hotel star-rating. The linear regression model of both cities show two similar patterns: 1) 5-star and 1-star hotels charge above what is expected while 2) 3-star and 4-star charge below what is expected for hotels of that nature in the specific city. Yet when compared to the regression model for the Gulf region the strength of both patterns is diminished.

Figure 4.8 also indicates 5-star Aqaba hotels are priced along the average of the region. Given the effects of the Arab Spring on tourism in Taba, the average price of 5-star hotel rooms in the region may see a price increase in the next few years. A proof of the existence of a regional hotel market lies in studying whether 5-star Aqaba hotels raise prices simultaneously with the region. This assumed price elasticity that results from the regional market will simultaneously allow Aqaba 5-star hotels to increase prices while still calling for Eilat 5-star hotels to decrease prices in order to stay competitive within the region. At the moment, the large price spread in 5-star hotels between Eilat and the region can be explained through a simulacrum of Figure 2.8 in which the perceived risk of holidaying in Taba, Egypt is simply not worth the rock bottom prices now being offered.

Eilat, serving mainly an Israeli market particularly wary to instability in Egypt, is setting its prices as if the hotels in Taba did not exist. This differs from Aqaba where the Arab market is less likely to avoid travel to Taba at those low prices.

Evidence proving the existence of a regional market lies in 2 and 3-star hotels, absent from Taba. At these ratings Eilat’s hotels come closest to the regional average price point. This is a result of Taba 4-star hotels being so cheap at present that Aqaba 2 and 3-star hotels must lower their own prices in order to avoid losing customers. The low prices of the 94

2 and 3-star hotels in Aqaba pose a more direct competition to 2 and 3-star hotels in Eilat leading them to react in a way that 5-star Eilat hotels don’t have to. Figure 4.8 therefore shows some evidence of a regional tourism market, in which, although it is segmented, one segment of the market reacts to supply and demand in another segment.

Points Awarded:

In terms of points awarded hotel rooms per night with price differentials of less than

NIS 100 according to star-rating each earn one point. After taking into consideration the cost of transport and border exit fees 4-star and 2-star hotels in Aqaba show a price differential below NIS 100 with similar offerings in Eilat thus earning two points. While 5- star and 3-star hotels in both cities show localized effects of over and undercharging respectively, regional markets help explain a more nuanced pricing strategy of Aqaba 5-star hotels and Eilat 3-star hotels. While no points are awarded for this, it serves as evidence of a regional tourism market.

C-3: Cross Border Attractions

Results and Discussion:

This indicator made use of Fodor’s Israel46 and Lonely Planet’s Jordan47 guide books. Both guidebooks include extensive details with regards to crossing the border at the

Rabin/Wadi Arabah crossing point including costs and opening hours. Lonely Planet’s

Jordan guide book further includes tips for dealing with Israeli and other Middle Eastern

46 Various. 2011. Fodor’s Israel 8th Edition. Ed Random House. 47 Various. 2009. Jordan 7th Edition. Ed Lonely Planet Publications. 95 countries’ immigration services. Yet with regards to cross-border attractions, Lonely

Planet’s Jordan makes no mention of any attractions in Eilat. As slight mentions to cross- border attractions in Jerusalem (p. 316) and Taba (p. 278) are included, Eilat’s absence appear to be due not to editorial policies excluding cross-border attractions but to a lack of worthwhile attractions as understood by the book’s editors. In comparison Fodor’s Israel guide book dedicates p. 500-511 to detailing access and sites in Petra. This is in comparison to 16 pages dedicated to Eilat (p.455-471). No additional attractions within Jordan or other countries are mentioned within the guide book. It stands to reason that Petra is a game changing attraction that Eilat simply doesn’t have anything to compare against for the international tourist catered to by these guide books. While Jerusalem, in particular, and snorkeling off the Egyptian coast are also presented as must see attractions, Eilat’s presentation as a sun, sand, and swim destination is a result of internationally relevant attractions.

In terms of day trips in Eilat and Aqaba, tour operators like ViaJordan Travel &

Tours48 and Desert Eco Tours49 provide cross-border services. In both cases, cross-border tours are sold on an ad-hoc basis provided that sufficiently large enough groups (at least 2 people) request the service. In interviews, local stakeholders could not identify a travel agency based solely on providing cross-border tours. Cross-border attractions identified by these travel agencies include Wadi Rum and Petra near Aqaba with longer trips allowing for religious sites such as Mt. Nebo further inland While Eilat attractions include the

Underwater Observatory Marine Park and Dolphin Reef. Longer stays within Israel from

48 See http://www.viajordan.com/extra_pages.php?page_name=Aqaba%20Eilat%20tour%20- %20Tour%20Itinerary&page_id=1559 4/23/13. 49 See http://www.desertecotours.com/english/jordan_short_tours.asp 4/23/13. 96

Aqaba include Jerusalem. Local tour operators have consequently identified a greater number of cross-border attractions than the previously analyzed guide books that only make mention of Petra.

Points Awarded:

Two points are awarded for the existence of cross-border day trips from each city. A third point is awarded for the inclusion of a cross-border attraction in a guide book.

C-4: Relations between Hotels.

Results and Discussion:

In order to determine the value of this indicator interviews were carried out with politicians at the municipal level and local academics. This provided historical information necessary to award points.

Points awarded:

No evidence was found to suggest that bi-national hotel recommendations and cross-promotions occur at a systematic level. While limited interaction such as leaving cards for hotels near Petra in Eilat hostels does exist, this is not done at a systematic level or as part of a formal agreement between hoteliers. In as much, no formal body exists or has been proposed that would allow hoteliers from both sides of the border to meet or share marketing efforts. Finally, shared political initiatives have yet to be presented at the local or national level by hotel or tourist groups operating in Eilat-Aqaba simultaneously on both sides of the border. As a result of these events, zero points are awarded for this indicator. 97

Summary:

Table 4.20: Points Awarded for Indicators Column ‘C’

Indicator 1 2 3 4 Total

Points 4 2 3 0 9

As a driving force towards integrating the bi-national city, tourism is leading the way, despite scoring only slightly above half the possible points. While land crossings between Eilat and Aqaba reflect the timeline of regional conflicts, long term growth shows less resistance to cross-border movement and the discovery of cross-border attractions by tourists on both sides of the border. This greater movement is reflected in the burgeoning creation of a combined hotel market throughout the Gulf of Aqaba region (including Taba,

Egypt).

While this is particularly the case in 4-star hotels, evidence for its spread throughout the middle and top-tier hotels can be found. As hotels of comparable quality spread throughout the region, price sensitivity will increase among travellers. Yet the fact that as of now hoteliers have not established permanent contact with their equivalents across the border means that much may still be done to establish the region as a destination competing with against other regions outside the Gulf of Aqaba and to integrate cross-border attractions into single holiday packages. In this regard the unique circumstance of having four countries so close together may add appeal to the tourist market. While all cities in the region stand to gain from this, Aqaba is as of now the most important transit point in the region as evidenced in Table 4.21 (below). 98

Table 4.21:

Total International Arrivals (in Thousands) by Crossing in the Gulf of Aqaba Region, 2009 Eilat Aqaba Taba-Nuewiba Haql Arriving to: Wadi Elat Arava Airport Durrah Seaport Airport Taba Nuewiba Durrah Aravah Eilat, Israel x x x 142.8 x x x 210 x x Aqaba, Jordan x 71.5 x x x x x x 458 201 Taba-Nuewiba, 130.7 x x x x 449.2 x x x x Egypt Haql, KSA x x x x 254.9 x x x x x Arriving From: Outside Region x x 48.4 x x x 97.5 x x x Total Arrivals To: 250.6 944.4 668 201

City Total as % of Regional 12% 46% 32% 10% Total Source: Central Bureau of Statistics Israel, Department of Statistics Jordan, and Egypt

Tourism Authority 2012

Although common sense dictates that future investments in tourist infrastructure take this into account eventually resulting in the integration of a larger tourism land use crescent spanning several countries, unique political circumstances limiting the spillover of local and internationally based tourism groups (e.g. Israel’s and KSA’s strong visa controls). This suggests that limiting goals to joint projects such as snorkeling or golf holiday packages to just Taba, Eilat, and Aqaba marketed towards international tourist may one day prove a boon to the region.

D-1: Land Use Pattern Analysis of Eilat-Aqaba

Results and Discussion:

Figure 4.9 (below) shows land use in Eilat-Aqaba in 2002. Evidence of mirrored development includes transport developments such as airports, seaports, and border crossing stations. Similarly, north-south highways connecting each city to its national capital and to southern border crossings exist on both sides. Shorelines at the mouth of the

Gulf are dedicated to tourism development while the residential land use is located next to the tourism developments bordering the north-south highway. While extremely similar land use patterns existed in 2002, major differences include the amount of land dedicated to industrial use (mostly greenhouse farming) and tourism developments in Eilat in comparison to Aqaba and the proximity of urban development to the borderline in Eilat in comparison to Aqaba.

100

Figure 4.9: Landuse Map 2002

Ten years later mirrored growth is still evident as seen through the consolidation of the residential land use in Eilat and Aqaba as well as in the consolidation of industrial developments outside each city’s core. Figure 4.10 (below) further illustrates improvements in Aqaba’s road network and upgraded seaport (2009). The expansion of tourism development in Aqaba has been towards the Israeli border While Eilat’s salt works and industrial farms have further consolidated along the Jordanian border. Future land development in Aqaba, as seen in Figure 4.10, include expansion of the existing residential 101 zone to its north, along the highway to the east of the airport, and the land between the

Wadi Arabah border crossing station and the tourism district.

Figure 4.10: Landuse Map 2012

In terms of future development, Krakover points out the recent attractiveness of the land along the border in Aqaba and Eilat.50 Seeing it as proof of a tacit normalizing of

50 Krakover, S. 2011. Cross border interactions across a formerly hostile border: The case of Eilat, Israel and Aqaba, Jordan, Central European Regional policy and Human Geography, Vol. 1(2), pp. 51-64. 102 relations between both countries, Krakover identifies proposed tourism megaprojects on each side including the Ayla (Aqaba) and Aquaria (Eilat). While the Ayla project is now under construction, Aquaria remains on the drawing board. The most stunning example of reduction of fear among both sides since 2001 is the end of construction of the King’s

Winter Palace in Aqaba near the Israeli border51. The normalization of these borderlands has in many ways been achieved with local, national, and commercial planners submitting proposals for the use of these lands. While a comparison of Figure 4.9 and 4.10 shows that the physical approximation of Eilat and Aqaba has occurred slowly over the last decade,

Krakover suggests that these efforts will increase over the next coming years.

Points Awarded:

The expansion of Aqaba’s tourism district towards the international border as well as evidence provided by Krakover is enough to grant a first point. A second point is awarded for the expansion of the combined industrial lands in both Eilat and Aqaba; While these industrial areas are partially off-set by the development of a new industrial area outside Eilat, new industrial parks with clear access to the Rabin/Wadi Arabah border crossing bare the role of border on local land planning. In comparison no points are awarded for the failed efforts to combine or relocate the region’s transport infrastructure nor are points awarded for the movement of residential land use further away from the border itself in both cities.

51 Completed in 2005 per http://www.kingabdullah.jo/index.php/en_US/pages/view/id/167.html accessed on 19/11/13. 103

D-2: Utility Consumption Standards

Results and Discussion:

In terms of similarities in the use of utilities, Eilat and Aqaba show stark differences. Table 4.22 (below) shows that as measured per capita, Eilat provides three times the amount of electricity and six times the amount of water than Aqaba. This is of particular note given that Aqaba now has a population twice the size of Eilat’s.

Table 4.22: Population and Utilities in Eilat & Aqaba

Electricity Water City Population Watts/prsn./day Litres/prsn./day

Eilat 46,400 680 200

Aqaba 94,091 198 38

Source: Various52

One way to ameliorate the difference in utility provision is to consider provision to dwellings over population.53 In this sense Table 4.23 (below) shows that based on an

52 http://www.jpost.com/Enviro-Tech/Eilat-Eilot-to-be-20-percent-solar-in- 6-months http://www.cbs.gov.il/population/new_2009/table3.pdf

http://quod.lib.umich.edu/j/jii/4750978.0008.207?rgn=main;view=fulltext

https://www.cia.gov/library/publications/the-world factbook/rankorder/2042rank.html

53 Deaton, A. 1989. The Influence of Household Composition on Household Expenditure Patterns: Theory and Spanish Evidence in Journal of Political Economy vol. 92 no. 1. 104 average of 3.45 inhabitants per dwelling in Aqaba versus 2.60 inhabitants per dwelling in

Eilat, differences in utility provision is reduced on a per dwelling basis. This is particularly the case in water provision as the difference is reduced to under four times the water used per dwelling in Eilat than in Aqaba. The difference in electricity use per dwelling is similarly reduced to 2.58 times the total used in Aqaba in comparison to measuring per capita.

Table 4.23: Housing and Utilities in Eilat & Aqaba

Electricity Water City Dwellings Watts/dwlng/day Litres/dwlng/day

Eilat 17,800 1,773 521

Aqaba 27,211 685 131

Source: Various 54

Rates of water and energy use per capita and dwelling in both cities are likely to decrease due to government initiatives and partnerships. In the case of Aqaba, electricity rate hikes in 2010 and studies centering on reducing water and electricity use in

5-star hotels55 are being matched with projected investments in building a new power plant

54 http://quod.lib.umich.edu/j/jii/4750978.0008.207?rgn=main;view=fulltext http://data.worldbank.org/indicator/EG.USE.ELEC.KH.PC https://www.cia.gov/library/publications/the-world-factbook/rankorder/2042rank.html

55 USAID. 2012. Energy and Water Audit Report for 5-star hotel in Aqaba, Jordan. USAID/Jordan. 105 within the Aqaba Qualified Industrial Zone.56 In terms of residential use, the AREE project is meant to establish better construction standards for green homes in Aqaba.57 Eilat has been ambitious in stating goals of obtaining 20% of its electricity through renewable resources (solar power)58 and, in collaboration with the city of San Antonio (USA), reducing per capita water consumption to 130 liters/person/day.59 Yet even if all these projections come to true, utility provision in Eilat will continue to be far above that available in Aqaba. As each city’s plans show, Eilat is a mature market with high coverage and heavy use of utilities; the city emphasis is now on efficiency and reducing the environmental impact of the municipality. In comparison, Aqaba needs to develop new power and water sources for public consumption. The lack of available resources has required hotels designed at international standards to find localized solutions to meet guests’ needs.

Points Awarded:

In terms of points awarded none of the four metrics present conditions within 20% of achieving parity between Eilat and Aqaba. Consequently zero points are awarded for this indicator.

56See Aqaba Power Plant in: http://www.global-power.co.il/content.asp?id=3&l1=0&l2=0&m=3&t=page May 26th 2013. 57 Rosenlund, H. 2008. Building Green in Jordan? Performance Evaluation of the Aqaba Residential Energy Efficiency Pilot Project (AREE). 58 Udasin, S. 2011. Eilat-Elot to be 20% solar in 6 months in Jerusalem Post. August 19t,h 2011. 59 Udasin, S. 2011. Texas signs water utility deal with Eilat in Jerusalem Post. July 15th 2011. 106

D-3: Border Hours and Transport Schedule

Results and Discussion:

Based on agreements with regards to border crossings, Israel and Jordan mutually allow each other’s cars and pedestrians to make use of the Rabin/Wadi Arabah border crossing. Hours of operation match on either side of the border (8-20 hours Friday-Saturday and 6:30-20 hours Sunday-Thursday). The border remains open under normal circumstances with the exception of the 1st day of the Muslim New year and Yom Kippur.

While plenty of erroneous or out of date information regarding hours of operation is available online, correct information is provided at the border itself in multiple languages.

When crossing with a vehicle from either country, cars change license plates for local plates at the border. This is a unique product of the peace agreement between Israel and

Jordan as evidenced by the fact that Jordanian and Saudi vehicles cross the border at Aqaba without changing license plates.

Transport to/from the border crossing can be done by either minibuses organized by tour companies or taxis. Taxi services are regulated with a taxi base operated outside of

Wadi Arabah and IAA booking taxis for people at the Rabin crossing. Bus service between

Eilat and Aqaba is considered within the Peace Treaty but is as yet not operated. It is of note that besides limited bus service (JETT as part of its 1st class bus monopoly) between

Amman and Jeddah, the only land connection to the Kingdom of Saudi Arabia is by taxi.

Reaching the international borders in the region therefore rely on local agreements with taxi owners or unions. Taxi services present limited transport integration within the region. The 107 one exception is the Aqaba ferry to Neuwiba and the scheduled local bus service between

Eilat and the Taba border crossing.

In terms of transport costs, Table 4.24 (below) shows that the cost (in USD/km) to travel from city center (defined as the central bus station) to the border crossing in Aqaba and Eilat is very similar. While using ASEZA’s recommended price makes the price differential negligible (USD .02), even the so called ‘tourist’ price espoused by the taxi union at Wadi Arabah maintains an average price consistent with Eilat’s metered-taxi service.

Table 4.24: Taxi Cost Rabin/Wadi Arabah to Central Bus Station 21/01/13

Place Direction Distance (km) Cost USD USD/km

To 9.87 1.00 Aqaba 9.91 From 16.92 1.71

To 6.07 1.36 Eilat 4.45 From 6.42 1.44

* ASEZA suggests JD 10 for trips between Wadi Arabah

crossing and Aqaba i.e. USD 1.42 /km

Points Awarded:

Full points are awarded for the exact match in hours and days of operations by both stations. An additional point is awarded given that each station allows pedestrian, vehicular, and taxi service either through or to/from the station. While agreed upon bus service does not exist between Eilat and Aqaba, in practical terms equal transport services exist in 108 multiple modes. The fourth point is also awarded given the similarity in total costs to and from each border crossing to the center of each city via taxi. Cost differential in terms of

USD/km is USD .08 i.e. less than 10% of total transport costs.

D-4: Presence of Shared Infrastructure

Results and Discussion:

While a history of potential shared infrastructure projects exist between Eilat and

Aqaba dating to the signing of the Jordan-Israel Peace Treaty,60 as of yet only the border crossing stations are coordinated in their operation. Interviews with Eilat city officials refer to previous proposals of a jointly built and operated airport including a logistical platform, a casino stretching along the border itself, water treatment facilities responsible for both cities’ water supply, and the bigger still Red Sea-Dead Sea Canal. While the Red Sea-Dead

Sea Canal and its associated projects is still a possibility,61 every other project has raised hopes before being dismissed as either impractical for security reasons (for example the shared use of Aqaba Airport as mentioned in the Jordan-Israel Peace Treaty) or outlandish

(the cross-border casino) at the national or regional stage. In terms of water and electricity, few examples exist at a national level including the East Jerusalem Electric Company’s

33kw electrical connection to Jordan62 and the Yarmouk River water transference scheme first detailed in Annex II of the Peace Treaty. In the Eilat-Aqaba region, the 1994 Peace

60 http://www.mfa.gov.il/mfa/foreignpolicy/peace/regional/pages/gulf%20of%20aqaba-%20logistics- %20trade%20and%20industry.aspx and http://mfa.gov.il/MFA/PressRoom/1997/Pages/Meeting%20of%20the%20Aqaba-Eilat%20Commission.aspx 61 Rinat, Z. 2013. “Is the Red Sea –Dead Sea Canal about to become a reality?” in Haaretz. January 16th 2013. 62 Goldstein, T. 2006. “Israel to allow electricity import from Jordan to Jericho” in Ynet, September 25th 2006. 109

Treaty grandfathered in Israeli water wells in Wadi Arabah (Jordan). These water wells continue under the operation of Israel and their supply is routed to Israel although the wells are registered in Jordan. Alexander Kushnir, the head of Israel’s Water Authority, has described this arrangement positively.63 A final shared project is the Aqaba Marina that through a specific agreement brokered through SKAL International allows for Israeli yachts to make use of the facilities of the Aqaba Marina including docking and repairs. According to Eilat officials there is as yet no example of this agreement being put into practice64.

While many joint infrastructure projects have been proposed few are in operation.

Recent history and security fears are a main motivation for the coordinated projects as evidenced through the detailed agreements on water between Israel and Jordan. While none of the above examples can be said to be jointly operated, shared responsibility and coordinated activities based around strict definitions of sovereignty are present in each case. The numerous treaties and proposals meant to make Eilat-Aqaba a sort of testing site for new cooperation schemes has yet to truly take off in terms of infrastructure development.

Points Awarded:

Two points are awarded for this indicator based upon the jointly overseen Israeli water wells in Wadi Arabah as well as for the coordinated operations of the border crossing stations. While an argument for additional points may be made based on the shared use of

Aqaba’s Marina, the lack of users gives grounds to reason that not all shared projects are mutually beneficial thus negating their purpose.

63 Horovitz, D. 2013. “How Israel beat the drought” in The Times of Israel, February 26th 2013. 64 It is important to note that Prof. Krakover gives anecdotal evidence of Israeli yachts being repaired in Aqaba as early as 2009. 110

Summary:

Table 4.25: Points Awarded for Indicators Column ‘D’

Indicator 1 2 3 4 Total

Points 2 0 4 2 8

The four indicators presented above demonstrate that with regards to creating a bi- national city, infrastructure development in Eilat-Aqaba is a mixed bag. While shared infrastructure projects do exist, these are more a consequence of managing the peace between Israel and Jordan (e.g. interconnected border stations and infrastructure connections to preexisting wells) and not as a result of resetting regional economic parameters that result in projects that were previously economically unviable. Similarly high level negotiations and long term political agreements assure the smooth running of these projects. Yet these projects have been of limited consequence in developing both cities. Instead mirror growth has continued along the lines of a resort town model complemented with a secondary logistical and industrial hub. The main change with regards to economic development in the region is that Aqaba has taken the lead from Eilat in terms of infrastructure development and attracting new private investment. A deeper exploration of economic development in Aqaba may best determine if its growth has to do with ASEZA as an innovative governing structure that may be replicated throughout the

Gulf of Aqaba region or whether it is due to the unique features that Aqaba presents. In this sense Aqaba’s rebranding effort as a beach resort town in socially relaxed Jordan, has successfully brought new investment and tourists into the region from the Gulf Coast 111

Council countries. Yet similar to Eilat’s construction boom in the 1980’s and 1990’s, little of the newly built tourist infrastructure is bi-national in nature or design. Where a possibility for joint infrastructure between both cities exists is in service provision. While new investments in Aqaba have yet to result in material living standards comparable to

Eilat’s, the political and economic costs related to increasing utility provision in the region may require jointly operated or developed infrastructure. Examples of this extend from mega projects like the Red-Dead Canal to simply redundant research on ecological building standards that are being carried out on both sides. At the local scale, infilling of lands adjacent to the international border present the best opportunity for long term infrastructure integration given the existing political arena for sharing development plans between both cities and the high political costs of alternately developing relatively inexpensive projects like shared casinos, convention centers, or golf courses.

5. Discussion

The purpose of this section is to attain research objective 2, which reads, “Show that prevailing models and definitions fail to account for the more complicated story of the development of ‘ever closer relations’ between Eilat-Aqaba since the signing of the Peace

Treaty.” This will be done by analyzing the results of the previous section to describe how the process of cross-border integration has occurred within each of the four industries.

These descriptions help place the cross-border integration process of each industry within the theoretical model detailed in the literature review. Finally, the theoretical model is examined with regard to its sufficiency and completeness: does it explain the narratives 112 surrounding the four sectors and the overall picture they create of the cross-border integration process of Eilat-Aqaba, and is it sufficient as an explanation.

Table 5.1: Results of the Indicators showing Bi-National City Integration Processes for

Eilat, Israel-Aqaba, Jordan

A. B. C. D. Infrastructure Gradus-Ehlers International Environmental Tourism Total Matrix Commerce Management

1. Proximity 0 4 4 2 10

2.Socioeconomic 1 0 2 0 3 Similarity

3. Function 0 0 3 4 7

4.Competitive 0 3 0 2 5 Cooperation

Total 1 7 9 8

Differences between the Results of the Gradus-Ehlers matrix and the Theoretical

Model

Table 5.1 shows that of the economic sectors expected by Gradus to lead the cross-border integration process, tourism has proven the most important (but with environment and infrastructure not lagging far behind); in comparison international commerce proves the sector that least integrates Eilat-Aqaba. Of Ehlers’ four tests, proximity has been the easiest to overcome. National level initiatives such as the creation of ASEZA, national development plans, and bi-national treaties have allowed for greater communication and compatibility at the local level to increase proximity. Greater cross-border tourism, 113 measured through increasing numbers of border crossings at Rabin/Wadi Arabah, has been the reward of these actions. This top-down process for overcoming barriers to proximity in

Eilat-Aqaba is symbolic of the fact that the border integration process in Eilat-Aqaba stems from the political will of supranational and national governments and not from local cross- border cultural groups.

The lack of local cross-border cultural groups is squarely manifest in the tourism sector where no meaningful interaction exists between hoteliers across the international border. The interviews with local politicians and researchers in Aqaba and Eilat show that prior to the present peace treaty there was little if any interaction between themselves or any other group in Eilat and Aqaba. Instead vital communication was conveyed through the

US State Department or US congressmen. While the local considerations of Eilat and

Aqaba were included in the 1994 Peace Treaty, Eilat politicians present at the time comment that their contribution to shaping sections of the peace treaty discussing conditions between Eilat and Aqaba were not based on existing interactions or plans between both cities but on Eilat’s experience of working with Taba, Egypt after the Camp

David accords. According to these same politicians, Eilat’s experience working with Taba highlighted the potential of the same four economic sectors that Gradus suggested for cooperation between Eilat and Aqaba.

The parallel relationship of Eilat-Taba and Eilat-Aqaba is interesting as it suggests that the Gradus-Ehlers matrix may be replicated to study cross-border integration between

Eilat and Taba. This suggests that the Eilat-Aqaba bi-national city may extend to include the resorts of Taba. Simultaneously, the need for local politicians to set the tone for Eilat and Aqaba’s relationship based on a parallel relationship highlights the lack of local 114 knowledge of Aqaba that Eilat’s politicians had at the time. This is evidence of the lack of local cross-border cultural groups present prior to 1994. Whilst this can be expected in

Eilat-Aqaba given that any discussion prior to 1994 was done at the national level (usually through a third-party), it conflicts with Model 2.6 which expects that local knowledge prior to 1994 would result in the political pressure necessary to establish a unique relationship between Eilat and Aqaba during the peace negotiations. This is in sharp contrast with the high-level discussions and relations of the national governments of Israel and Jordan which existed since prior to the forming of the state of Israel. These discussions were centered at the Israeli Prime Minister’s office and the Jordanian King’s office; a set-up that continues to this day. In comparison to the border integration model which assumes that sections pertaining to Eilat-Aqaba were due to politicking by local groups on both sides of the border, the reality appears to be that working agreements have existed between Israel and

Jordan since the founding of both states. The whole of the 1994 Jordan-Israel Peace Treaty is a manifestation of this built-up political will as expressed initially through the Oslo

Accords negotiated under US auspice.65

International commerce has been the least successful in overcoming barriers to cross-border integration. At the same time, socioeconomic similarity has proven the most difficult test to cross-border integration in Eilat-Aqaba. While Ehlers herself identifies socioeconomic similarities inherently difficult to overcome between More Economically

Developed Countries and Less Economically Developed Countries as is the case between

65 If anything, it is surprising to see the lack of success in building local enthusiasm for local integration between Israelis and Jordanians in comparison to the running press dedicated to local integration efforts between Israelis and Palestinians or between Jordanians and Palestinians. 115

San Diego, USA and Tijuana, Mexico;66 socioeconomic similarity and international commerce in Eilat-Aqaba have also suffered from inconsistent national and international efforts towards economic integration.

Detailed Examples of the Economic Impact of the Differences between the Case Study and the Theoretical Model

A key example of economic programs that have suffered from inconsistent efforts towards economic integration has been the Qualifying Industrial Zone (QIZ) program. Approved by the US Congress in 1996, the program allows for benefits of the US-Israel Free Trade

Agreement to be extended to pre-approved industrial zones in Jordan in which factories use a minimum of 35% raw inputs from Israel in all final products prior to export to US markets.

Gaffney mentions that the purpose of the QIZ is to incentivize face-to-face contact between Israeli and Jordanian businessmen as a way to solidify peace in the Middle East.67

Yet as an economic incentive, the QIZ scheme has proven to not go far enough. Structural limitations to the QIZ include the creation of the US-Jordan Free Trade Agreement and the

Jordan-Israel Free Trade Agreement which overtake some of the benefits of the QIZ (e.g. local input minimums on textiles) but not all (e.g. quotas on the export of textiles to the

USA) . The disjointed policy of multiple schemes means unnecessary competition between them which reduces their effectiveness. The latter two bilateral trade treaties between Israel

66 Ehlers, N. 2001. Op cited 67 J. Gaffney. 2005. Jordan’s Qualified Industrial Zones: A Qualified Success? University of Pennsylvania, USA. Thesis 116 and Jordan undermine the QIZ scheme’s efforts to raise bilateral trade. As described by

Gaffney, the combination of the multiple treaties means that less input of Israeli raw materials is required to qualify under the QIZ scheme as a result of adding a series of discount factors based on the number of workers hired or operating losses by the individual factories that are incorporated in the new treaties.

Although these modifications to the QIZ scheme has generated shared revenues in

Jordan topping USD 1 billion by the mid-2000s, QIZs have failed to be incorporated in either Israel’s or Jordan’s economy. This is due to the failure of the QIZs to build linkages within the national economies or to develop independently of government investment.68 As a case in point, Aqaba’s QIZ was financed through a USAID grant.69 The failure of QIZs to be embraced by either country’s economic system is symptomatic of the ills plaguing bi- national commercial relations between Israel and Jordan. Although political efforts to stimulate trade are plentiful, they have not been met with the corresponding political changes necessary to capitalize on the hard-fought trade agreements. An additional example is the guest worker program operated together with the governments of Eilat and Aqaba which is presently limited to around 100 Jordanian nationals,70 Similarly, industrialists involved in cross-border commerce have faced social backlash against their businesses in such sectors as the used car market.71

Finally there are many things that have failed to occur in Eilat-Aqaba. These include joint tourism campaigns, transport infrastructure development, and the creation of a common consumer goods market. The lack of a common market is of particular note given

68 Gaffney op. cited 69 See http://www.aqabazone.com/index.php?q=node/527 August 5th, 2013. 70 as described in interviews with Eilat politicians 71 Ma’ayeh, S. 2010. Unease over Jordan-Israel Trade in The National (UAE). September 20th, 2010. 117 that even the existence of special tax regimes on both sides has failed to harmonize consumer prices and instead provide benefits that compete with the national market.

The national market is of incredible importance to both Eilat and Aqaba given that about 5.7 million of the 6.7 million total bed-nights registered in Eilat in 2011 were paid by national tourists While 41% of the 503,000 tourists to Aqaba in 2011 were Jordanians,72

For Israelis and Jordanians, Eilat and Aqaba are unique tourist destinations dedicated to

SSS (sun, sand, and swim) along the Red Sea within the national context. This helps ensure a stable demand from a dedicated national market that is only augmented by foreign demand.

While previous sections have shown how a regional market for hotel rooms is taking shape, neither the ‘Eilat +’ nor the ‘Oasis Golden Triangle’ campaigns sponsored by each city are aimed at luring away the other city’s national market. This is particularly interesting given each campaign’s focus on developing each city’s image in the foreign market. The focus of tourism campaigns on international markets is in all likelihood a result of regional politics. As seen in Figure 4.8 and Figure 4.6, the effect of regional politics is the reduction of regional competition in SSS tourist destinations as seen in the case of

Taba. The reduction in competition from other Gulf cities favors the concentration of national tourist monopolies in Eilat and Aqaba which make local cross-border promotions uneconomical. As a result neither city focuses on attracting the other’s national market resulting in a greater reliance on growing the international market.

72 Tirosh, N. 2013. Mutual Strategy Relationship of Eilat vs. Aqaba as Tourism Destination at www.swotclock.com August 6th 2013. 118

A Detailed Example of the Economic Impact of the Differences between the Case

Study and Historical Theories of Border Studies

Contrary to historical perspectives which place strong sociopolitical borders along strong physical borders, the existing national boundaries within the Arava Valley are distinctly socio-political and not physical. As presented in the literature review, Eilat and Aqaba span the Arava Valley both existing within clearly demarcated ethnic and linguistic lines that conform to a strong border line between Israel and Jordan. Yet, as evidenced in the previous chapter, aside from the international tourist culture that pervades both cities; there is little if any homegrown common culture spanning them.

Historical border studies theories expect such a weak border to prove porous meaning that in comparison to the center of the country, the Arava Valley should for historic reasons contain a culturally mixed population. Yet, this ‘soft’ boundary has been

‘hardened’ by political circumstances at the regional level as seen through the establishment of national boundaries (e.g. conquest of Um Rashrash in 1948) and at the national level (e.g. the resettlement of local Bedouin populations inside the Siyag during the 1960’s). The level to which political matters play in determining the boundaries of unique sociocultural space in the region can be seen through the relative ease with which shifting national borders expand/contract sociocultural ones. For example, since their respective independence both Israel and Jordan have adjusted national boundaries for strategic reasons with Jordan conducting a land exchange with the Kingdom of Saudi

Arabia in 1965 that extended Jordan’s seashore near Aqaba while Israel has engaged in land-for-peace diplomacy and expanded or abandoned settlements within its territorial claims. 119

In comparison the Arava Valley section of the Israel-Jordan border is not an example of a soft boundary as witnessed through the sharing of water resources on either side such as wells and resources of the Yarmouk River in the peace treaty. The mutual respect shown by both parties of this politically hardened border has allowed for politically advantageous environmental management projects that extend out to the Gulf itself. These projects serve as politically neutral and mutually advantageous common ground between both countries. That these projects exist within the local context of Eilat-Aqaba is of interest while the fact that political efforts helped achieve high scores within some indicators in the Gradus-Ehlers matrix is intriguing. As it appears that the narrative of Eilat-

Aqaba is a positive one within the greater discourse of bi-lateral peace and regional stability, it seems that local politicians should emphasis this local narrative in discussions with national politicians. The ability of Eilat-Aqaba to turn national political will into local development projects is furthermore unique to it given its place within the peace treaty.

This is particularly important given that bi-national politics are in many ways subservient to Middle East and North Africa politics (i.e. interviewees denote that sometimes it is just not the right time to discuss certain matters across the border but that soon it may be a better time) which extend beyond very tight cross-border dynamics of language and religion to economic matters. Yet political limitations on competitive cooperation are evident not just from the lack of a common consumer market encompassing

Eilat-Aqaba as seen in the previous chapter, but in the lack of competition for sources of direct foreign investment by Eilat and Aqaba. Major hotels in Eilat belong almost exclusively to Israeli chains such as Panorama and Isrotel, while major development 120 projects in Aqaba have used sources of financing unavailable for political reasons to Eilat.

These include Kuwaiti sovereign wealth backed development corporations.73

In other words, contrary to historical theories that call for strong natural borders to maintain the cultural separations which grant the State greater control of the border, in

Eilat-Aqaba strong political distinctions and strong cultural separations maintain each other. Furthermore, it is the State that has sought to establish cross-border interaction from which may be built a cross-border cultural group. This complicates the border integration model given that a seeming contradiction exists between the State’s efforts to devolve power to local groups and the State’s desire to maintain strong political boundaries. This could be symptomatic of a simultaneous desire and fear of the regional political repercussions that peace brings.

The Impact of the Expanded Role of Local Government in the Case Study

The State’s continued efforts to spark the cross-border integration process are in response to the fact that self-sustaining local political clout across the Eilat-Aqaba region has yet to manifest itself. Institutional actors have developed multiple forums such as peace summits and mayoral meetings as well as carried out basic agreements necessary for operating the bare-bones infrastructure (e.g. the Rabin/Wadi Arabah crossing point) that connects the two cities. Yet no equivalent forums exist for private business or regular citizens in the Eilat-

Aqaba region. As evidenced in the previous chapter tourist groups appear to be the closest to coalescing together but as yet aren’t able to affect the political process of the region.

73 See a list of hotels in Aqaba at http://www.aqabazone.com/index.php?q=node/117 121

Therefore local politicians must guess and test which policies to implement locally and recommend to central government officials in order to further the cross-border integration process. This means that for the time being the person-to-person relationships that exist among the political elites of the cross-border region are more important than civil or business ties in carrying out the day-to-day relations that bind Eilat-Aqaba together.74

This is not to underestimate the importance of the cross-border relations that do exist outside political channels, but to show that political actors have embraced the opportunities that cross-border relations bring over the general population of Eilat and

Aqaba. This shades the cross-border integration process in a political color through which civil society gains. For example, the increased flow of goods highlighted in the previous chapter is important for its political significance, and not the other way around as expected by the border integration model. As things stand, local trade and tourist interest groups have yet to catch-up to the political efforts made towards advancing cross-border integration.

This helps explain why no cross-border civil society initiatives have been presented to local and national officials concerning Eilat-Aqaba.75 Having limited actors on both sides limits the channels of communication available for carrying out the cross-border integration process. This leads to a bottleneck where opportunities to enhance the functionality (i.e. activities and relationships) between Eilat and Aqaba are lost.

74 For example the Municipality of Eilat has a list of about 1000 Jordanians that it considers vital to maintaining relations with Aqaba and Jordan 75 As stated in interviews with government officials of Eilat and Aqaba 122

Modeling the Eilat-Aqaba Bi-National City

Up to now, this chapter has focused on findings that prove fundamental to understanding the degree to which the Eilat-Aqaba case study exists as a bi-national city. In short, a case has been made to fully include Eilat-Aqaba within the bi-national city literature beyond Gradus’ previous qualified reticence. Yet through this research, four key differences between the Eilat-Aqaba case study and the cross-border integration model expounded in the literature review have cropped up due to the cold peace. In order to achieve research objective 2, the rest of this chapter will focus on resolving these four differences (Four Statements) between the case study and the established theory. This dialectic will result in modifying the border integration model found in the literature review in order to better deal with the cold peace.

The Four Statements:

1- The cross-border integration process in Eilat-Aqaba stems from the political will of supranational and national governments and not from local cross-border cultural groups.

2- National and international efforts towards the economic integration of Eilat and Aqaba have been inconsistent and in some cases counterproductive.

3- No historical cross-border cultural group exists unique to Eilat-Aqaba.

4- There is, as yet, no self-sustaining local political clout spanning the Eilat-Aqaba region.

123

If we are set on defining the nature of the borderlands in the Eilat-Aqaba region, the four sectors analyzed as part of the Gradus-Ehlers matrix do not show a singular nature.

The different sectors can be presented within the existing border integration model by defining a different boundary type for each economic sector within the borderlands. The different types of boundaries are then mapped along Parker’s Continuum of Boundary

Dynamics static to fluid scale.76 In short, Parker’s examples of different types of boundaries are simply replaced with case-specific ones as exemplified in Figure 5.1

(below).

76 The nature of each boundary is determined using a sixteen point scale based on the total number of points awarded for its four indicators in the Gradus-Ehlers matrix 124

Figure 5.1: Borderlands in the Eilat-Aqaba Region

Figure 5.1 uses the border typology to examine the relative border condition of each of the four sectors. According to the results of Figure 5.1, the borderlands in the Eilat-

Aqaba region show differing natures. Assuming that the sixteen point scale is equally 125 distributed along the Nature of Boundaries vertices, only tourism can be said to begin to be of a porous nature. Given that the nature of each type of boundary prior to the signing of the Jordan-Israel Peace Treaty would rate as extremely static (0 points), the progress made towards transitioning from Parker’s Border to Frontier has been truly quick and remarkable.

While questions with regards to whether bi-national policies will seek further progress towards a porous and fluid frontier or how to further open the international commerce boundary exist, what is clear is that the cross-border integration process in Eilat-Aqaba has significantly altered the nature of several important types of borders as a result of the normalization of relations between Israel and Jordan.

Yet the reliance of the cross-border integration process in Eilat-Aqaba on the bi- national agenda means that the results of the process are still wholly reliant on the regional political situation, to which the relations between Israel and Jordan correspond. This is related to statements 1, 3, and 4 justified previously in this chapter which explain why

Brunet-Jailly’s Theory of Borderland Studies model is too simplistic given the political realities faced by the Eilat-Aqaba case study.

One way Brunet-Jailly’s model proves simplistic is its use of a virtuous cycle as a mechanism. It proves unsatisfactory for cold peace settings in that the inherent tension in international relations, one strong enough that it can put a stop to the cross-border integration process at several steps of the process, isn’t included within Brunet-Jailly’s model. A second way in which Brunet-Jailly’s model proves simplistic is its reduction of the multi-tiered political process into a single internal process of ‘policy activities of multiple levels of government’. Reducing the multi-tiered process into a single process is unrealistic given that the national political concerns of Israel and Jordan might not be in 126 line with those of the greater regional political situation to which both must respond. The existence of different goals and concerns among actors within the political process helps explain Statement number 2 given that either country may be forced to implement policies in disagreement with the overall cross-border integration process due to regional political concerns. Unbundling the political process into several separate political processes (the regional, bi-national, and local) within Brunet-Jailly’s model allows for a more truthful interplay of cold peace conditions. For example, and in comparison to what is predicted by

Brunet-Jailly’s theory, it is the central governments of both countries that are responsible for initiating the cross-border integration process (as mentioned by statement 1). An additional benefit of unbundling the political process, and in response to statement 4, is that local government processes can be treated separately within the model.

Separating the local from the national political process does not require an additional expansion of the model. This is because the role played by local governments in

Eilat-Aqaba, with regards to the cross-border integration process, is of making recommendations and providing arguments for the continued expenditure of central government resources in the Eilat-Aqaba region. Thus local governments take on the role of local cross-border political clout theorized by Brunet-Jailly. An additional role of local government in the region is promoting and regulating international tourism in the region

(this is accomplished through environmental management, service provision, land management, and other local development policies). This is particularly important given that for now, international tourists’ makeup the cross-border cultural group of Eilat-Aqaba.

Having international tourists as the cross-border cultural group is not such a strong departure from Brunet-Jailly’s theory, even though international tourists are not a group 127 indigenous to the region, and do not directly share a cultural or ethnic affiliation with either side of the border. Instead, their existence as outsiders to the regional political situation, and the globalized tourist culture, give them advantages within a region that depends heavily on tourism. As tourist cities, Aqaba and Eilat have captured their home market and must now expand to international markets in order to grow. International tourists have, in effect, introduced a third culture (tourist culture) that has cultural expectations of languages used, infrastructure development, proximity to attractions, ease of movement, and level and types of services, that helps bridge the cultural differences between Eilat and Aqaba. The local phenomenon of this culture in the region has even affected construction patterns as seen through the categorization of new hotel developments using the international metric of the star system by hotel groups (used in the previous chapter). Their outsider status and disposable income make international tourists an important cultural group given their ability and willingness to explore both sides of the border. This gives groups on both sides of the border an economic motivation to participate in this third culture in order to increase the visits and extend the stays of international tourists. As a final point, the symmetry of the model is broken by the internal processes within each national government. As a reaction to the domestic forces and understanding of the regional political situation, both Jordan and

Israel face different internal times and government political reviews. As described previously in terms of the QIZ scheme and used car imports, the Jordanian government may face stronger domestic resistance to further bi-national cooperation while, as evidenced in more stringent visa requirements, Israeli governments weigh regional political concerns with greater emphasis on security grounds. These modifications to the second part of the border integration model can be visualized by in Figure 5.2 (below): 128

Figure 5.2: The Theory of Borderland Studies applied to Eilat-Aqaba

Figure 5.2 shows an initial effort to apply Brunet-Jailly’s model (Figure 2.5) to the case study. Specifically, Figure 5.2 displays the symmetrical processes within both countries and cities, and how they prove subservient to the regional political situation.

Brunet-Jailly’s model can be seen in the interplay of the combined central government cooperation through international tourism, trade flows, and local government response feeding back to either city’s central government. This is important given that central governments filter the regional political situation for the other actors both within their own country and for those relying on bi-national cooperation. 129

Figure 5.2 shows that the cross-border integration process flows according to how the regional political situation is felt by both countries’ central governments and through them by people and organizations in and outside of the region. If it is a good time to discuss these issues, cooperation between both governments will flow warming the peace process.

This facilitates the inflow of additional international tourists who through market process

(along with other marginal sources of cross-border trade in Eilat-Aqaba) increase trade flows that reach local governments separately. Having discussed through institutional channels each cities’ development plans, each local government will invest in some type of environmental management policy that will help further attract international tourism (by responding to its cultural demands) and make recommendations using available metrics to each country’s central government (in both cases directly to the Prime Minister’s office) who will the waters once more. As things stand, the lack of a rigid agreement between actors concerning the process means that it could be redesigned in some way at some time.

Yet this seems unlikely given the success so far of the present scheme.

While Figure 5.2 carries the aforementioned advantages, there are certain elements that it finds harder to accurately describe. For instance, that in comparison to the original model, a local cross border culture was inexistent before the peace and is only very weak now. Similarly, local cross border political clout is still very weak, while economic competition is stronger than cooperation in the region. Finally, that market forces and trade flows are where most gains are to be made even if there hasn't been coherent multi-level governance.

130

Figure 5.2’s dual country model with its parallel process can be further flattened to a one dimensional model more akin to Brunet-Jailly’s initial model. This is achieved by bundling each country’s internal processes into a single model of bi-national city integration as shown in Figure 5.3 (below). While Figure 5.3 does not allow for a side-by- side comparison between Israel and Jordan’s internal processes regarding cross-border cooperation, the figure brings to light the bi-national city processes itself. The clear comparison to Brunet-Jailly’s model helps to focus on those issues raised by the deficiencies of Figure 5.2 as seen in the possible failures of the process at each step.

Figure 5.3: The Eilat-Aqaba Bi-national City Process Model

131

Figure 5.3 highlights the six-step process along which the multi-tiered political system not only reaches the local scale of Eilat-Aqaba, but shows were specific problems for continuing the creation of the bi-national city lie. Relating to Figure 5.3 the following list of pitfalls exist and will continue to exist until the process is somehow transformed:

Potential Pitfalls in the Eilat-Aqaba Bi-national City Process Design:

1- The deterioration of the regional political situation makes bi-national cooperation unwise or impossible.

2- Bi-national cooperation proves ineffective at alleviating security concerns in the region resulting in a drastic year-on-year fall in international tourists to Eilat-Aqaba.

3- Demand from international tourists to visit the region is exhausted; this results in a stagnant market for tourist services that reduces the perceived power of the global tourist culture in Eilat-Aqaba.

4- Falling revenues from bi-national trade incentivize either city to disregard their shared development model in favor of a non-compatible or competitive development model.

Damage to bi-lateral relations ensues.

5a- The resort town model reaches the end of its lifecycle and efforts to increase the appeal of the region to new markets fail. The cross-border cultural group, international tourists, slowly decreases its presence in Eilat-Aqaba.

5- Changes in personalities at the local or central government level result in the diminished capacity of local politicians to successfully influence national actors and decisions. 132

6- Efforts towards bi-national cooperation negatively affect the regional political situation.

According to the border integration model, the main way the cross-border integration process may be modified is through changes to the actors and their context

(actor/context). As shown by Knippschild, the final third of the border integration model permits for actor/context’s to modify the process design (i.e. the bi-national city model detailed in Figure 2.6) by affecting the process initiator. Statement 1, from the beginning of this subchapter, makes clear that it is supranational and national governments that initiate the cross-border integration process in Eilat-Aqaba; similarly Figures 2 and 3 show how the interplay between the regional political situation (i.e. political processes involving supranational and regional governments) and the national governments of Israel and Jordan involve two different complementary dynamics. This creates a slightly different condition from Knippschild’s model in that the modification of the process design has a very clear origin while the resulting modifications made by national governments to their own bilateral processes will consequently cascade through the remaining actors thus having a total effect on the context as seen in Figure 5.4 below). In short, modification to the process design will result in changing actors/context in terms of the Eilat-Aqaba cross-border integration process.

133

Figure 5.4: Actor and Context Analysis for the Eilat-Aqaba Region

In this chapter the three parts of the border integration model were modified in order to reconcile it with the case study. This required an in depth discussion of the results of the previous chapter with regards to the unique conditions created by the cold peace. The set of figures resulting in the Eilat-Aqaba Bi-national City Process model allows for the results of the Ehlers-Gradus matrix to be plotted and modeled per the aims of this thesis. In so doing, research objective 2 is achieved given that the cold peace conditions prevalent in Eilat-

Aqaba do not disqualify it from working as a bi-national city. In short, this chapter shows that the case study fits the border integration model with only minor modifications. 134

This chapter uses Figures 5.2 in order to describe in detail how the cross-border integration occurs in Eilat-Aqaba and Figure 5.3 to list a series of potential pitfalls in the current process design. In comparison to Gradus’ premonition in 2001, these two figures show how further integration of the bi-national city of Eilat-Aqaba may occur under current conditions. While no actor currently involved in the bi-national city process is likely to wrest away control of the process design away from national political actors, the ability of these actors to redesign it along with the continued political will forced in place by previous bilateral agreements means that further integration is likely to continue. This will rely heavily on the ability of local politicians to continue to attract international tourists to the

Gulf region.

6. Conclusions

The purpose of this thesis has been to analyze whether two cities on either side of a cold peace may produce a bi-national city. While examples of bi-national cities are not numerous, Ehler’s concept serves as an ideal for maximum integration between border cities. The ability to compare to an ideal is important given that political capital spent on

Eilat, Israel and Aqaba, Jordan during the bi-lateral peace process shows the importance that both countries place on developing real lasting links between the cities. These links are in many ways the mundane positive gains of the Jordan-Israel Peace Treaty and thus provide a positive spin to bi-lateral talks beyond the existential paradigm of peace. This is important to the greater peace process as it provides relatively easy victories for politicians as well as serving as an example of the benefits of peace for other border cities in the 135 region. Being a relatively new integration process and given the regional political situation,

Eilat-Aqaba is unique among other bi-national city case studies for existing in a political state of a cold peace. It was therefore to be expected that reaching the ideal of being now a fully functioning bi-national city was highly unlikely. Yet, given the limitations placed on the case study by the cold peace, Eilat-Aqaba proves to be a worthy candidate for inclusion as a bi-national city given that a process for bringing about the bi-national city exists. This process is in some ways unique given the multiple and almost independent political dynamics on which the integration process rests. The results of this thesis suggest that these complications can be accommodated by minor modifications to existing theory in order to extend its reach to cold peace situations.

What is more controversial from theoretical perspective, and is a source for future study, is whether international tourists can serve as the local cultural group pushing for bi- national city dynamics in the region, thus, successfully bridging the very real differences between residents on both sides of the border. Future studies could highlight whether international tourists are a critical mass to affect long-term change and what advantages their outsider status grants them that local groups can emulate, this particularly important given the limited size, at present, of international tourists in the region. Studies on international tourists may additionally provide insight into creating policies to increase international commerce in the Eilat-Aqaba region possibly through the nuances of outsider status. One possible avenue is to establish whether attacks against international tourists in the region correspond to an understanding of them as an important force for integration and peace. 136

Additional works that may spring from this thesis include updating the results in order to contextualize any perceived progress in the creation of the bi-national city. In this sense the Gradus-Ehlers matrix is of particular use given its specific context and versatility in developing precise indicators for Eilat-Aqaba. This versatility allows for other bi- national city case studies to use the basic matrix replacing Gradus’ specific elements to those of the region to be studied. Similarly, in the case of Eilat-Aqaba other areas of mutual interest and cooperation such as security could be used to analyze the workings of the bi- national city. Security proved to crop up in interviews as a day-in and day-out issue among the interviewees with each local government interacting with their national security apparatus in their own way.

Another source of cooperation that has meaningful implications at the local level but outside of the boundaries of this study is Israeli-Jordanian coordination on religious pilgrimage to Mecca and Medina. This is particularly important as it requires a large number of Israeli citizens to travel through Aqaba thus melding the categories of locals and international tourists in the region. These relationships are indicative of larger cooperation between both countries than may be the norm for cold peace border regions.

In carrying out this research, three practical problems proved unavoidable. The first problem, previously discussed in depth, is the different statistical sets kept by government agencies on both sides of the border. While each of these tell their own story and together can tell a single congruent story, the different statistics kept by each country suggest that further stimulating commercial cooperation may demand cooperating in creating similar definitions in both countries accounting practices. Similarly, they suggest that public records may serve a secondary role to help sell the advantages of bi-national cooperation to 137 some reticent groups thus providing political cover for governments hoping to legitimize trade in a hostile environment. As always, the real fear is that incongruent information distorts reality leading to a loss in investor confidence thus limiting the full economic impact of the existing bilateral trade agreements.

A second problem faced was that the Gulf region in effect includes four cities

(Taba, Eilat, Aqaba, and Durrah) spread across four countries. While immigration statistics suggest that Aqaba is the region’s keystone, Durrah’s lack of a tourism sector and Taba’s small residential population and lack of an industrial sector means that Eilat serves as the connecting middle of the region. Taba’s development as a tourist city dedicated to sun, surf, and sand together with Durrah’s development of a small industrial core suggests that future studies may want to expand to study all four neighboring cities in tandem. Unfortunately the existing political situation did not allow for this expanded region to be studied.

One final complication faced by this research was the initial reticence by stakeholders to be interviewed. While initial reluctance was put down as it not being an opportune time given deteriorating conditions in the Gaza Strip in late 2012, it is clear that certain social pressures against cross-border cooperation exists in the Eilat-Aqaba region.

This must be qualified by saying that good person-to-person cross-border relations are also visible in the region. On a practical level this is important given the different institutional cultures on either side of the border as Jordan prefers to rotate management teams with some regularity while Israel has individuals who have served as the public face of an organization for over a decade. 138

These complications play into the limited purview of the methodology. While the thesis used interviews conducted with key informants, it ignores regular citizens and the business community. Further research is required to explore how these groups utilize the freedom to cross the border and other privileges of life on the border. Even if, as concluded, the ability of these groups to make use of the bilateral agreements is limited, targeted research may further shed light on cross border cooperation in Eilat-Aqaba. This reservation is important vis-a-vis the models developed given that they fail to conclude whether the limited importance of these groups in the borderlands is due to a lack of interest, opportunity, or other reasons. For example, while local asymmetries such as socioeconomic, cultural, and linguistic are treated within the thesis; the local population’s perception of their personal security and the effectiveness of existing border policies in securing it escape the breadth of this thesis. This is particularly important given the asymmetry in the generalized view expressed in Jordanian media of Israel as a source of regional instability compared to Israeli-Jews’ limited empathy for Jordanians and view of

Jordan as a low-threat neighbor.77 It stands to reason that the suggested model would place such issues within the realm of pressure groups and public opinion weighing in on local and national politicians on either side of the border.

While the concept of bi-national cities was purposefully crafted to serve a small subset of border cities, it does serve as one way to interconnect the different disciplines of urban studies and border studies. As in the case of Eilat and Aqaba, these two disciplines have much to say to each other and therefore provide further opportunities for understanding a complicated region. One issue in particular that border studies may take

77 Maoz, I et als. 2009. Psychological correlates of public support for reconciliation: The Israeli-Jordanian casein Peace and Conflict Studies. Vol. 16 No. 1. 139 away from urban studies has to do with regards to post-border planning. While the concept of bi-national city does not have a clear end-goal in mind (are two cities that physically converge with each other still bi-national cities?) seeing as bi-national cities are defined by the presence of the border, urban planning is almost exclusively a discipline based on creating and overcoming borders. These can be either physical or abstract. In the particular case of Israel and Jordan, the ability to interact and overcome borders represents access to the mundane. I believe that it is in the mundane that a warm peace lies. Eilat and Aqaba in this sense have been chosen by either country to serve together as an access to the mundane and up to now it has been international tourists who have taken the first steps through.

140

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